Required information Problem 21-3A Flexible budget preparation; computation of materials, labor, and overhead variances; and overhead variance report LO P1, P2, P3, C2 [The following information applies to the questions displayed below.) Antuan Company set the following standard costs for one unit of its product. Direct materials (6 lbs. @ $5 per Ib.) Direct labor (2 hrs. @ $17 per hr.) Overhead (2 hrs. $18.50 per hr.) Total standard cost $ 30 34 37 $ 101 The predetermined overhead rate ($18.50 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 (758 Capacity) Variable overhead costo Indirect materialo $ 45,000 Indirect labor 180,000 Power 45,000 Repairs and maintenance 90,000 Total variable overhead costs Pixed overhead costs Depreciation Building 24,000 Depreciation Machinery 80,000 Taxes and insurance 12,000 Supervision 79,000 Total fixed overhead costs Total overhead coats $360,000 195,000 $555,000 The company incurred the following actual costs when it operated at 75% of capacity in October Direct materials (91,000 Ibs. @ $5.10 per lb.) $ 464,100 526,125 Direct labor (30,500 hrs. @ $17.25 per hr.) Overhead costs Indirect materials Indirect labor Power Repairs and maintenance Depreciation-Building Depreciation-Machinery Taxes and insurance Supervision Total costs $ 44,250 177,750 43,000 96,000 24,000 75,000 11,500 89,000 560,500 $1,550,725 Problem 21-3A Part 3 3. Compute the direct materials cost variance, including its price and quantity variances. AQ = Actual Quantity SQ - Standard Quantity AP Actual Price SP = Standard Price Actual Cost Standard Cost