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Route 66 Tire Co. manufactures automobile tires. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of
Route 66 Tire Co. manufactures automobile tires. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of 10,000 tires were as follows: Standard Costs Actual Costs Direct materials 85,000 lbs, at $6.25 83,800 lbs, at $6.17 Direct labor 4,000 hrs. at $20.80 4,450 hrs. at $21.00 Factory overhead Rates per direct labor hr., based on 100% of normal capacity of 5,000 direct labor hrs. Variable cost, $2.90 $11,375 variable cost Fixed cost, $11.40 $57,000 fixed cost Required: a. Determine the price variance, quantity variance, and total direct materials cost variance. Enter a favorable variance as a negative amount, and an unfavorable variance as a positive amount. Price variance Quantity variance Total direct materials cost variance b. Determine the rate variance, time variance, and total direct labor cost variance. Enter a favorable variance as a negative amount, and an unfavorable variance as a positive amount. Rate variance Time variance Total direct labor cost variance c. Determine variable factory overhead controllable variance, the fixed factory overhead volume variance, and total factory overhead cost variance. Enter a favorable variance as a negative amount, and an unfavorable variance as a positive amount. Variable factory overhead controllable variance Fixed factory overhead volume variance Total factory overhead cost variance
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