Factory Overhead Cost Variance Report

Feeling Better Medical Inc., a manufacturer of disposable medical supplies, prepared the following factory overhead cost budget for the Assembly Department for October of the current year. The company expected to operate the department at 100% of normal capacity of 7,300 hours.

Variable costs:
Indirect factory wages	$21,170
Power and light	17,301
Indirect materials	14,381
Total variable cost		$52,852
Fixed costs:
Supervisory salaries	$14,610
Depreciation of plant and equipment	37,470
Insurance and property taxes	11,430
Total fixed cost		63,510
Total factory overhead cost		$116,362

During October, the department operated at 7,700 standard hours, and the factory overhead costs incurred were indirect factory wages, $22,550; power and light, $17,920; indirect materials, $15,500; supervisory salaries, $14,610; depreciation of plant and equipment, $37,470; and insurance and property taxes, $11,430.

Required:

Prepare a factory overhead cost variance report for October. To be useful for cost control, the budgeted amounts should be based on 7,700 hours. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Round your per unit computations to the nearest cent, if required. If an amount box does not require an entry, leave it blank.

Feeling Better Medical Inc.

Factory Overhead Cost Variance ReportAssembly Department

For the Month Ended October 31

Normal capacity for the month 7,300 hrs. Actual production for the month 7,700 hrs. Budget Actual Favorable Variances Unfavorable Variances Variable costs: Indirect factory wages Power and light Indirect materials Total variable cost Fixed costs: Supervisory salaries Depreciation of plant and equipment Insurance and property taxes Total fixed cost Total factory overhead cost Total controllable variances Excess hours used over normal at the standard rate for fixed factory overhead