Direct materials (3.0 Ibs. @ $5.00 per Ib.) $ 15.00 Direct labor (1.8 hrs. @ $12.00 per hr.) 21.60 Overhead (1.8 hrs. @ $18.50 per hr.) 33.30 Total standard cost $ 69.90 The predetermined overhead rate ($18.50 per direct labor hour) is based on an expected volume of 75% of the factory’s capacity of 20,000 units per month. Following are the company’s budgeted overhead costs per month at the 75% capacity level. Overhead Budget (75% Capacity) Variable overhead costs Indirect materials $ 15,000 Indirect labor 90,000 Power 15,000 Repairs and maintenance 30,000 Total variable overhead costs $ 150,000 Fixed overhead costs Depreciation—Building 23,000 Depreciation—Machinery 70,000 Taxes and insurance 17,000 Supervision 239,500 Total fixed overhead costs 349,500 Total overhead costs $ 499,500 The company incurred the following actual costs when it operated at 75% of capacity in October. Direct materials (46,000 Ibs. @ $5.20 per lb.) $ 239,200 Direct labor (19,000 hrs. @ $12.30 per hr.) 233,700 Overhead costs Indirect materials $ 41,600 Indirect labor 176,500 Power 17,250 Repairs and maintenance 34,500 Depreciation—Building 23,000 Depreciation—Machinery 94,500 Taxes and insurance 15,300 Supervision 239,500 642,150 Total costs $ 1,115,050
Direct materials (3.0 Ibs. @ $5.00 per Ib.) $ 15.00 Direct labor (1.8 hrs. @ $12.00 per hr.) 21.60 Overhead (1.8 hrs. @ $18.50 per hr.) 33.30 Total standard cost $ 69.90 The predetermined overhead rate ($18.50 per direct labor hour) is based on an expected volume of 75% of the factory’s capacity of 20,000 units per month. Following are the company’s budgeted overhead costs per month at the 75% capacity level. Overhead Budget (75% Capacity) Variable overhead costs Indirect materials $ 15,000 Indirect labor 90,000 Power 15,000 Repairs and maintenance 30,000 Total variable overhead costs $ 150,000 Fixed overhead costs Depreciation—Building 23,000 Depreciation—Machinery 70,000 Taxes and insurance 17,000 Supervision 239,500 Total fixed overhead costs 349,500 Total overhead costs $ 499,500 The company incurred the following actual costs when it operated at 75% of capacity in October. Direct materials (46,000 Ibs. @ $5.20 per lb.) $ 239,200 Direct labor (19,000 hrs. @ $12.30 per hr.) 233,700 Overhead costs Indirect materials $ 41,600 Indirect labor 176,500 Power 17,250 Repairs and maintenance 34,500 Depreciation—Building 23,000 Depreciation—Machinery 94,500 Taxes and insurance 15,300 Supervision 239,500 642,150 Total costs $ 1,115,050
Chapter8: Standard Costs And Variances
Section: Chapter Questions
Problem 13PA: Recompute the variances from the second Acme Inc. exercise using $0.0725 as the standard cost of the...
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Question
Direct materials (3.0 Ibs. @ $5.00 per Ib.) | $ | 15.00 |
Direct labor (1.8 hrs. @ $12.00 per hr.) | 21.60 | |
Overhead (1.8 hrs. @ $18.50 per hr.) | 33.30 | |
Total |
$ | 69.90 |
The predetermined overhead rate ($18.50 per direct labor hour) is based on an expected volume of 75% of the factory’s capacity of 20,000 units per month. Following are the company’s budgeted overhead costs per month at the 75% capacity level.
Overhead Budget (75% Capacity) | |||||
Variable overhead costs | |||||
Indirect materials | $ | 15,000 | |||
Indirect labor | 90,000 | ||||
Power |
15,000 |
||||
Repairs and maintenance | 30,000 | ||||
Total variable overhead costs | $ | 150,000 | |||
Fixed overhead costs | |||||
23,000 | |||||
Depreciation—Machinery | 70,000 | ||||
Taxes and insurance | 17,000 | ||||
Supervision | 239,500 | ||||
Total fixed overhead costs | 349,500 | ||||
Total overhead costs | $ | 499,500 | |||
The company incurred the following actual costs when it operated at 75% of capacity in October.
Direct materials (46,000 Ibs. @ $5.20 per lb.) | $ | 239,200 | |||
Direct labor (19,000 hrs. @ $12.30 per hr.) | 233,700 | ||||
Overhead costs | |||||
Indirect materials | $ | 41,600 | |||
Indirect labor | 176,500 | ||||
Power | 17,250 | ||||
Repairs and maintenance | 34,500 | ||||
Depreciation—Building | 23,000 | ||||
Depreciation—Machinery | 94,500 | ||||
Taxes and insurance | 15,300 | ||||
Supervision | 239,500 | 642,150 | |||
Total costs | $ | 1,115,050 | |||
![ANTUAN COMPANY
Overhead Variance Report
For Month Ended October 31
Expected production volume
Production level achieved
Volume variance
Flexible Budget Actual Results Variances
Fav. / Unfav.
Variable costs
Fixed costs
Total overhead costs](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F30510a28-61e6-4037-9ef5-d1ee868e44b9%2F3b7cb399-f293-4b53-9177-3f454dcead4c%2Frtex7kq_processed.png&w=3840&q=75)
Transcribed Image Text:ANTUAN COMPANY
Overhead Variance Report
For Month Ended October 31
Expected production volume
Production level achieved
Volume variance
Flexible Budget Actual Results Variances
Fav. / Unfav.
Variable costs
Fixed costs
Total overhead costs
![4. Compute the direct labor cost variance, including its rate and efficiency variances. (Indicate the effect of each variance by
selecting for favorable, unfavorable, and No variance. Round "Rate per hour" answers to two decimal places.)
Actual Cost
Standard Cost
$](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F30510a28-61e6-4037-9ef5-d1ee868e44b9%2F3b7cb399-f293-4b53-9177-3f454dcead4c%2Fpb3ts7s_processed.png&w=3840&q=75)
Transcribed Image Text:4. Compute the direct labor cost variance, including its rate and efficiency variances. (Indicate the effect of each variance by
selecting for favorable, unfavorable, and No variance. Round "Rate per hour" answers to two decimal places.)
Actual Cost
Standard Cost
$
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