Required information

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 (1.9 hrs. @ $10.00 per hr.)		19.00
Overhead (1.9 hrs. @ $18.50 per hr.)		35.15
Total standard cost	$	69.15

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		24,000
DepreciationMachinery		71,000
Taxes and insurance		18,000
Supervision		279,250
Total fixed overhead costs					392,250
Total overhead costs				$	527,250

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

Direct materials (45,500 Ibs. @ $5.20 per lb.)				$	236,600
Direct labor (20,000 hrs. @ $10.20 per hr.)					204,000
Overhead costs
Indirect materials	$	41,600
Indirect labor		176,750
Power		17,250
Repairs and maintenance		34,500
DepreciationBuilding		24,000
DepreciationMachinery		95,850
Taxes and insurance		16,200
Supervision		279,250			685,400
Total costs				$	1,126,000

rev: 04_27_2020_QC_CS-209738

5. Prepare a detailed overhead variance report that shows the variances for individual items of overhead. (Indicate the effect of each variance by selecting for favorable, unfavorable, and No variance.)

ANTUAN COMPANY Overhead Variance Report For Month Ended October 31 Expected production volume 75% of capacity 75% of capacity Production level achieved Volume variance No variance Flexible Budget Actual Results Variances Fav. / Unfav. Variable costs Indirect materials Indirect labor Power Repairs and maintenance Total variable costs Fixed costs DepreciationBuilding DepreciationMachinery Taxes and insurance Supervision Total fixed costs Total overhead costs