Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please hurry Antuan Company set the following standard costs per unit for its product. Direct materials (4.0 pounds @ $5.00 per pound) Direct labor (1.7

please hurry
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Antuan Company set the following standard costs per unit for its product. Direct materials (4.0 pounds @ $5.00 per pound) Direct labor (1.7 hours @ $10.00 per hour) Overhead (1.7 hours @ $18.50 per hour) $ 20.00 17.00 31.45 Standard cost per unit $ 68.45 The standard overhead rate ($18.50 per direct labor hour) is based on a predicted activity level of 75% of the factory's capacity of 20,000 units per month. Following are the company's budgeted overhead costs per month at the 75% capacity level. Overhead Budget (758 Capacity) Variable overhead costs Indirect materials. $ 15,000 Indirect labor 75,000 Power 15,000 Maintenance 30,000 135,000 Total variable overhead costs Fixed overhead costs 24,000 Depreciation-Building Depreciation-Machinery Taxes and insurance 71,000 17,000 Supervisory salaries. 224,750 Total fixed overhead costs i 336,750 Total overhead costs $ 471,750 The company incurred the following actual costs when it operated at 75% of capacity in October. $ 311,100 Direct materials (61,000 pounds @ $5.10 per pound) 224,400 Direct labor (22,000 hours $10.20 per hour). Overhead costs Indirect materials Indirect labor $ 41,950 176,400 17.250 Power Taxes and insurance Supervisory salaries /1,000 17,000 Total fixed overhead costs 224,750 336,750 Total overhead costs $ 471,750 The company incurred the following actual costs when it operated at 75% of capacity in October Direct materials (61,000 pounds $5.10 per pound) Direct labor (22,000 hours $10.20 per hour) $ 311,100 224,400 Overhead costa $ 41,950 Indirect materials Indirect labor Power 176,400 17,250 34,500 24,000 95,850 Maintenance Depreciation-Building Depreciation Machinery Taxes and insurance Supervisory salaries Total costa 15,300 224,750 630,000 $1,165,500 Required: 1. Prepare flexible overhead budgets for October showing amounts of each variable and fixed cost at the 65%, 75%, and 85% capacity levels. ANTUAN COMPANY Flexible Overhead Budgets Flexible Budget at Capacity Level of 65% Variable Amount Total Fixed per Unit Cost For Month Ended October 31 75% 85% 43 For Month Ended October 31 Production (in units) Variable overhead costs Fixed overhead costs Total overhead costs ANTUAN COMPANY Flexible Overhead Budgets Variable Amount Total Fixed per Unit Cost $ 0.00 $ $ 0 $ Flexible Budget at Capacity Level of 65% 75% 85% 0$ 0$ 05 0$ 0 0 $ 1,165,500 2. Compute the direct materials variance, including its price and quantity variances. (Indicate the effect of each variance by selecting favorable, unfavorable, or no variance.) Actual Cost Sta Actual quantity X Actual price Actual quantity Standard quantity X Standard price X $ 0

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Intermediate Accounting

Authors: kieso, weygandt and warfield.

IFRS Edition

978-1118443965, 1118800532, 9781118800539, 978-0470873991

More Books

Students also viewed these Accounting questions