Problem 08 3A Flexible budget preparation computation of materials, labor, and overhead variances and overhead variance report LO P1, P2, P3, P4 Skip to question The following information applies to the questions displayed below Antuan Company set the following standard costs for one unit of its product Direct materials (3 0 Ibs $5 00 per Ib ) $ 15 00 Direct labor (1 8 hrs $12 00 per hr ) 21 60 Overhead (1 8 hrs $18 50 per hr ) 33 30 Total standard cost $ 69 90 The predetermined overhead rate ($18 50 per direct labor hour) is based on an expected volume of 75 of the factorys capacity of 20,000 units per month Following are the companys budgeted overhead costs per month at the 75 capacity level Overhead Budget (75 Capacity) Variable overhead costs Indirect materials $ 15,000 Indirect labor 75,000 Power 15,000 Repairs and maintenance 30,000 Total variable overhead costs $ 135,000 Fixed overhead costs DepreciationBuilding 25,000 DepreciationMachinery 72,000 Taxes and insurance 16,000 Supervision 251,500 Total fixed overhead costs 364,500 Total overhead costs $ 499,500 The company incurred the following actual costs when it operated at 75 of capacity in October Direct materials (46,500 Ibs $5 10 per lb ) $ 237,150 Direct labor (22,000 hrs $12 30 per hr ) 270,600 Overhead costs Indirect materials $ 41,550 Indirect labor 176,950 Power 17,250 Repairs and maintenance 34,500 DepreciationBuilding 25,000 DepreciationMachinery 97,200 Taxes and insurance 14,400 Supervision 251,500 658,350 Total costs $ 1,166,100 Required 1 2 Prepare flexible overhead budgets for October showing the amounts of each variable and fixed cost at the 65 , 75 , and 85 capacity levels and classify all items listed in the fixed budget as variable or fixed Required 182 Prepare flexible overhead budgets for October showing the amounts of each variable and fixed cost at the 65 , 75 , and 85 capacity levels and classify all items listed in the fixed budget as variable or fixed ANTUAN COMPANY Flexible Overhead Budgets For Month Ended October 31 Flexible Budget Variable Amount Total Fixed per Unit Cost Flexible Budget for 65 of 75 of 85 of capacity capacity capacity Sales (in units) Variable overhead costs Indirect materials Indirect labor Power Repairs and maintenance $ 0 00 0 Total variable costs Fixed overhead costs Depreciation Building Depreciation Machinery Taxes and insurance Supervision Total fixed costs 0 0 Total overhead costs

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Problem 08-3A Flexible budget preparation; computation of materials, labor, and overhead variances; and overhead variance report LO P1, P2, P3, P4 Skip to question [The

Problem 08-3A Flexible budget preparation; computation of materials, labor, and overhead variances; and overhead variance report LO P1, P2, P3, P4

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[The following information applies to the questions displayed below.] Antuan Company set the following standard costs for one unit of its product.


Direct materials (3.0 Ibs. @ $5.00 per Ib.)	$	15.00
Direct labor (1.8 hrs. @ $12.00 per hr.)		21.60
Overhead (1.8 hrs. @ $18.50 per hr.)		33.30
Total standard cost	$	69.90

The predetermined overhead rate ($18.50 per direct labor hour) is based on an expected volume of 75% of the factorys capacity of 20,000 units per month. Following are the companys budgeted overhead costs per month at the 75% capacity level.

Overhead Budget (75% Capacity)
Variable overhead costs
Indirect materials	$	15,000
Indirect labor		75,000
Power		15,000
Repairs and maintenance		30,000
Total variable overhead costs			$	135,000
Fixed overhead costs
DepreciationBuilding		25,000
DepreciationMachinery		72,000
Taxes and insurance		16,000
Supervision		251,500
Total fixed overhead costs				364,500
Total overhead costs			$	499,500

The company incurred the following actual costs when it operated at 75% of capacity in October.


Direct materials (46,500 Ibs. @ $5.10 per lb.)			$	237,150
Direct labor (22,000 hrs. @ $12.30 per hr.)				270,600
Overhead costs
Indirect materials	$	41,550
Indirect labor		176,950
Power		17,250
Repairs and maintenance		34,500
DepreciationBuilding		25,000
DepreciationMachinery		97,200
Taxes and insurance		14,400
Supervision		251,500		658,350
Total costs			$	1,166,100

Required: 1&2. Prepare flexible overhead budgets for October showing the amounts of each variable and fixed cost at the 65%, 75%, and 85% capacity levels and classify all items listed in the fixed budget as variable or fixed.

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Required: 182. Prepare flexible overhead budgets for October showing the amounts of each variable and fixed cost at the 65%, 75%, and 85% capacity levels and classify all items listed in the fixed budget as variable or fixed. ANTUAN COMPANY Flexible Overhead Budgets For Month Ended October 31 Flexible Budget Variable Amount Total Fixed per Unit Cost Flexible Budget for 65% of 75% of 85% of capacity capacity capacity Sales (in units) Variable overhead costs Indirect materials Indirect labor Power Repairs and maintenance $ 0.00 0 Total variable costs Fixed overhead costs Depreciation Building Depreciation Machinery Taxes and insurance Supervision Total fixed costs 0 0 Total overhead costs