Required:

1. Examine the monthly overhead budget to (a) determine the costs per unit for each variable overhead item and its total per unit costs and (b) identify the total fixed costs per month
2. Prepare flexible overhead budgets (as exhibit 23.12) for December showing the amount for each variable and fixed cost at the 65%, 75% and 85% capacity levels.
3. Compute the direct material cost variance, including its price and quantity variances
4. Compute the direct labor cost variance, including its rate and efficiency variances
5. Compute a detailed overhead variance report (as exhibit 23.15) that shows the variances for individual items of overhead
   

Problem 23-33 Seacoast Companyr set the following standard costs for one unit of its product. Flexible budget preparation: computation Dlnecl: material: (4.5 lbs. 9 $5 per lb.) ......................... :27 0f mmrialsr labor. Direct labor (LE hrs. @ 5|: per Ir.) .......................... Ia and warhead \"\"3\"\"? Overhead (LS hrs. .9 am perhr.) ............................ it and warhead \"rim\" Total standard cost. ........................................ repon P1 P2 P3 [2 The predetemu'ned overhead rate ($16.00 per direct labor hour) is based on an expected volume 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 (15% Capacity) Variable overhead cost: indirect materials ......................... $12.51!!) indirect labor ............................. 90,4120 Power .................................. 21.560 Repairs and n'lainterenoe ................... 4am Total variable overhead cool: ................ \"30,000 Fined overhead costs DeprecladoHulldlng ..................... 245W.) Depreciation-Miner)! ................... T1120.) Tanner and Insurance ....................... lenoo Supervision .............................. 65M The companyr incurred the following actual costs when it operated at 35% of capacity in December. Chapter 23 Flexible Budgets and Standard Costs Dlmctmms(69.000|bs.@$&l0pa'lb.)......... Dlrecthbnrmhmllperhn) Owhead costs Indlrect "medals ............................. $10,600 Indlrect labor ................................ 02.260 Power ...................................... B. I 00 Repelrs and rnalmnemnce ....................... 46,000 Depreclacnbulldlng ......................... 24.000 |Z'.lE|:'arIe|:lail'le'aIIn'la:l'|l1e|")lr ...................... 75.000 Tans and Inmrmce ........................... I6.500 Supervtslnn .................................. 66,000 Total costs ..................................... IIo-qIIm-II 1. Examine the monthly overhead budget to (a) determine the costs per unit for each variable overhead S 410,900 200,440 355,260 SI 56,600 item and its total per unit costs, and (b) identify.r the total xed costs per month. Hepare exible overhead budgets (as in Exhibit 2.3.12.) for December showing the amounts of each variable and xed cost at the 65%, 75%, and 35% capacity.r levels. Compute the direct materials cost variance, including its price and quantity variances. Compute the direct labor cost variance, including its rate and efciency.r variances. Hepare a detailed overhead variance report (as in Exhibit 23.15) that shows the variances for indi- vidual items of overhead. 1025 Check l2) Budgeted total overhead at 11000 units. $384000 [3! Materials variances: Price, $6.900 U: Quantity, $9.000 U [4} Labor variances: Hate, $5.840 U; Eiciencv. $3,600 U