wnces or n Problem 21-4A set the following standard unit costs for its single product. Trico Company Computing materials, labor, and overhead $120 Direct materials (30 lbs. @ $4 per lb.) variances 70 Direct labor (5 hrs. @ $14 per hr.). P3 P4 Factory overhead-Variable (5 hrs. @ $8 per hr.) Factory overhead-Fixed (5 hrs. @ $10 per hr) 40 50 $280 Total standard cost The predetermined overhead rate is based on a planned operating volume of 80% of the productive c ity of 60,000 units per quarter. The following flexible budget information is available ssa Chapter 21 Flexible Budgets and Standard Costs Operating Levels 70% 80% Production in units... 90% 42,000 Standard direct labor hours 48,000 54.000 210,000 Budgeted overhead Fixed factory overhead Variable factory overhead 240,000 270,000 $2,400,000 $2,400,000 $2,400,000 $1,680,000 $1,920,000 $2,160,000 During the current quarter, the company operated at 90% of capacity and produced 54,000 units of prod- Uct actual direct labor totaled 265,000 hours. Units produced were assigned the following standard costs. Direct materials (1,620,000 lbs. @ $4 per lb.) Direct labor (270,000 hrs.@$14 per hr.) Factory overhead (270,000 hrs. @ $18 per hr.) Total standard cost... $ 6,480,000 3,780,000 4,860,000 $15,120,000 Actual costs incurred during the current quarter follow. Direct materials (1,615,000 lbs.@ $4.10 per lb.) Direct labor (265,000 hrs.@$13.75 per hr.) $ 6,621,500 3,643,750 2,350,000 Fixed factory overhead costs 2,200,000 $14,815,250 Variable factory overhead costs Total actual costs... 1.Compute the direct meterials cost variance, including its price and quantity variances. 2. Compute the direct Isbor cost variance, including its rate and efficiency variances. 3. Compute the overhead controllable and volume variances. Required Chapter 21 Flexible Budcets and Standard Costs Operating Levels 70% 80% 90% Production in units.. 42,000 Standard direct labor hours 48,000 54,000 210,000 240,000 Budgeted overhead 270,000 Fixed factory overhead Variable factory overhead. $2,400,000 $1,680,000 $2,400,000 $2.400,000 $1,920,000 $2,160,000 During the current quarter, the company operated at 90% of capacity and produced 54,000 units of prod- Uct: actual direct labor totaled 265,000 hours. Units produced were a assigned the following standard costs. Direct materials (1,620,000 Ibs. @$4 per lb.) $ 6,480,000 Direct labor (270,000 hrs.@$14 per hr.) 3,780,000 Factory overhead (270,000 hrs.@$18 per hr.) 4,860,000 Total standard cost $15,120,000 Actual costs incurred during the current quarter follow. Direct materials (1,615,000 lbs.@ $4.10 per lb.) Direct labor (265,000 hrs.@ $13.75 per hr) $ 6,621,500 3,643,750 2,350,000 Fixed factory overhead costs 2,200,000 Variable factory overhead costs $14,815,250 Total actual costs.. Required Compute the direct materials cost variance, including its price and quantity variances 2 Compute the direct labor cost variance, including its rate and efficiency variances. 3. Compute the overhead controllable and volume variances. information Problem 21-4A
