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Tannin Products Inc. prepared the following factory overhead cost budget for the Trim Department for July of the current year, during which it expected to

Tannin Products Inc. prepared the following factory overhead cost budget for the Trim Department for July of the current year, during which it expected to use 24,000 hours for production:

1

Variable overhead cost:

2

Indirect factory labor

$57,600.00

3

Power and light

14,400.00

4

Indirect materials

24,000.00

5

Total variable overhead cost

$96,000.00

6

Fixed overhead cost:

7

Supervisory salaries

$55,000.00

8

Depreciation of plant and equipment

39,200.00

9

Insurance and property taxes

152,300.00

10

Total fixed overhead cost

246,500.00

11

Total factory overhead cost

$342,500.00

Tannin has available 29,000 hours of monthly productive capacity in the Trim Department under normal business conditions. During July, the Trim Department actually used 26,000 hours for production. The actual fixed costs were as budgeted. The actual variable overhead for July was as follows:

1

Actual variable factory overhead cost:

2

Indirect factory labor

$61,580.00

3

Power and light

15,300.00

4

Indirect materials

28,300.00

5

Total variable cost

$105,180.00

Required:

Construct a factory overhead cost variance report for the Trim Department for July. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.
Amount Descriptions
Volume variance-favorable
Volume variance-unfavorable
Depreciation of plant and equipment
Indirect factory labor
Indirect materials
Insurance and property taxes
Net controllable variance-favorable
Net controllable variance-unfavorable
Power and light
Supervisory salaries
Total controllable variances
Total factory overhead cost
Total factory overhead cost variance-favorable
Total factory overhead cost variance-unfavorable
Total fixed factory overhead cost
Total variable factory overhead cost

Construct a factory overhead cost variance report for the Trim Department for July. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Tannin Products Inc.

Factory Overhead Cost Variance Report—Trim Department

For the Month Ended July 31

1

Productive capacity for the month

29,000 hours

2

Actual productive capacity used for the month

26,000 hours

3

4

Budget (at actual production)

Actual

Variances: Favorable

Variances: Unfavorable

5

Variable factory overhead costs:

6

7

8

9

10

Fixed factory overhead costs:

11

12

13

14

15

16

17

18

19

20

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