Factory Overhead Cost Variance Report Tiger Equipment Inc., a manufacturer of construction equipment, prepared the following factory overhead cost budget for the Welding Department for May of the current year. The company expected to operate the department at 100% of normal capacity of 8,400 hours. Variable costs: Indirect factory wages Power and light Indirect materials $30,240 20,160 16,800 $67,200 Total variable cost Fixed costs: Supervisory salaries $20,000 Depreciation of plant and equipment Insurance and property taxes 36,200 15,200 Total fixed cost Total factory overhead cost 71,400 $138,600 During May, the department operated at 8,860 hours, and the factory overhead costs incurred were indirect factory wages, $32,400; power and light, $21,000; indirect materials, $18,250; supervisory salaries, $20,000; depreciation of plant and equipment, $36,200; and insurance and property taxes, $15,200. Required: Prepare a factory overhead cost variance report for May. To be useful for cost control, the budgeted amounts should be based on 8,860 hours. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number, If an amount box does not require an entry, leave it blank. Tiger Equipment Inc. Factory Overhead Cost Variance Report-Welding Department For the Month Ended May 31 Normal capacity for the month 8,400 hrs. Actual production for the month 8,860 hrs. Variable factory overhead costs: Indirect factory wages Power and light Indirect materials Total variable cost Fixed factory overhead costs: Supervisory salaries Depreciation of plant and equipment Insurance and property taxes Total fixed cost Total factory overhead cost Total controllable variances Net controllable variance-unfavorable Actual Budget (at Actual Cost Unfavorable Favorable Production) Variances Variances Total controllable variances Net controllable variance-unfavorable Volume variance-favorable: Excess hours used over normal at the standard rate for fixed factory overhead Total factory overhead cost variance-favorable 100 00