Q1. Vargas Corporation is working on its direct labor budget for the next two months. Each unit of output requires 0.77 direct labor-hours. The direct labor rate is $11.20 per direct labor hour. The production budget calls for producing 6,100 units in October and 6,900 units in November. The company guarantees its direct labor workers a 40-hour paid work week. With the number of workers currently employed, that means that the company is committed to paying its direct labor work force for at least 5,480 hours in total each month even if there is not enough work to keep them busy. What would be the total combined direct labor cost for the two months?

Q2. The following data pertains to the month of October for ElmCo. when production was budgeted to be 5,000 units of P90. Fixed manufacturing overhead traceable to the production of P90 is budgeted to be $15,000 for the month and is assigned on the basis of the number of units manufactured using a pre-determined rate. Actual production of P90 for October was 4,600 units and actual fixed manufacturing overhead costs were $14,650. Determine the fixed overhead volume variance. (Negative numbers indicate a favorable variance.)

Q3. Q2. The following data pertains to the month of October for ElmCo. when production was budgeted to be 5,000 units of P90. Fixed manufacturing overhead traceable to the production of P90 is budgeted to be $15,000 for the month and is assigned on the basis of the number of units manufactured using a pre-determined rate. Actual production of P90 for October was 4,600 units and actual fixed manufacturing overhead costs were $14,650. Determine the fixed overhead spending variance. (Negative numbers indicate a favorable variance.)