Question
Songsu Company is struggling to control costs. We are hired as consultants to determine why the company's actual costs exceed budgeted costs. The Tableau
Songsu Company is struggling to control costs. We are hired as consultants to determine why the company's actual costs exceed budgeted costs. The Tableau Dashboard is provided for our analysis. 8 Direct Materials Standard Actual $7 $6 6 lbs Direct Labor Standard Actual $17 6 4 4 lbs 15 10 $14 2 5 2.5 hrs 2 hrs 0 0 Pounds Per Unit Price Per Pound Pounds Per Price Per Unit Pound Hours Per Unit Price Per Hour Hours Per Unit Price Per Hour 2 Stand Hours Per Unit Rate Per Hour Overhead - Standard Costs $20 $15 $10 $5 $0 8 hrs 6 hrs 4 hrs 2 hrs O hrs ... Fixed Overhead (Standard) $6 per unit Fixed Overhead (stand) Overhead - Actual Costs Variable Overhead $12 per hour Variable Overhead 2 hour 2 hours per unit per unit Fixed Overhead Variable Overhead Variable Overhead $169,000 Actual Overhead Variable overhead $101,000 Actual Overhead Fixed Overhead $68,000 Fixed Overhead Actual Units Manufactured Actual Units Manufactured: 5,100 units Req 1 and 2 Req 3 Compute the direct labor rate variance and direct labor efficiency variance. Indicate whether this cost variance is favorable, unfavorable or no variance. Actual Cost AH X AR $ 12,750 X 14.00 $ 178,500 Direct labor rate variance Direct labor efficiency variance Total direct labor variance Standard Cost AH X SR SH X SR 12,750 X $42.00 x 32 X $32.00 $ $ 1,024 535,500 $ 357,000 $ 534,476 $ 357,000 534,476 Favorable Unfavorable Unfavorable < Req 1 and 2 Req 3 > Req 1 and 2 Req 3 Compute the total overhead variance. Indicate whether this cost variance is favorable or unfavorable. Overhead variance: Actual total overhead Standard overhead applied Overhead variance Favorable
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