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[The following information applies to the questions displayed below.] Antuan Company set the following standard costs per unit for its product. Direct materials (4.0 pounds @ $5.00 per pound) Direct labor (1.6 hours @ $14.00 per hour) Overhead (1.6 hours @ $18.50 per hour) Standard cost per unit $ 20.00 22.40 29.60 $ 72.00 The standard overhead rate ($18.50 per direct labor hour) is based on a predicted activity level 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

[The following information applies to the questions displayed below.] Antuan Company set the following standard costs per unit for its product. Direct materials (4.0 pounds @ $5.00 per pound) Direct labor (1.6 hours @ $14.00 per hour) Overhead (1.6 hours @ $18.50 per hour) Standard cost per unit $ 20.00 22.40 29.60 $ 72.00 The standard overhead rate ($18.50 per direct labor hour) is based on a predicted activity level 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

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Required information [The following information applies to the questions displayed below.] Antuan Company set the following standard costs per unit for its product. Direct materials (4.0 pounds @ $5.00 per pound) Direct labor (1.6 hours @ $14.00 per hour) Overhead (1.6 hours @ $18.50 per hour) Standard cost per unit $ 20.00 22.40 29.60 $ 72.00 The standard overhead rate ($18.50 per direct labor hour) is based on a predicted activity level 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 Indirect labor $ 15,000 75,000 Power 15,000 Maintenance 30,000 Total variable overhead costs. 135,000 Fixed overhead costs 23,000 71,000 18,000 197,000 309,000 $ 444,000 Depreciation-Building Depreciation-Machinery Taxes and insurance Supervisory salaries Total fixed overhead costs Total overhead costs The company incurred the following actual costs when it operated at 75% of capacity in October. Direct materials (60,500 pounds @ $5.10 per pound) Direct labor (21,000 hours @ $14.40 per hour) Overhead costs Indirect materials Indirect labor Power Maintenance Depreciation-Building Depreciation-Machinery Taxes and insurance Supervisory salaries Total costs $ 41,900 176,650 17,250 34,500 23,000 95,850 16,200 197,000 $ 308,550 302,400 602,350 $ 1,213,300 3. Compute the direct labor variance, including its rate and efficiency variances. Note: Indicate the effect of each variance by selecting favorable, unfavorable, or no variance. Round "Rate per hour" answers to two decimal places. Actual Cost Standard Cost
Transcribed Image Text:Required information [The following information applies to the questions displayed below.] Antuan Company set the following standard costs per unit for its product. Direct materials (4.0 pounds @ $5.00 per pound) Direct labor (1.6 hours @ $14.00 per hour) Overhead (1.6 hours @ $18.50 per hour) Standard cost per unit $ 20.00 22.40 29.60 $ 72.00 The standard overhead rate ($18.50 per direct labor hour) is based on a predicted activity level 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 Indirect labor $ 15,000 75,000 Power 15,000 Maintenance 30,000 Total variable overhead costs. 135,000 Fixed overhead costs 23,000 71,000 18,000 197,000 309,000 $ 444,000 Depreciation-Building Depreciation-Machinery Taxes and insurance Supervisory salaries Total fixed overhead costs Total overhead costs The company incurred the following actual costs when it operated at 75% of capacity in October. Direct materials (60,500 pounds @ $5.10 per pound) Direct labor (21,000 hours @ $14.40 per hour) Overhead costs Indirect materials Indirect labor Power Maintenance Depreciation-Building Depreciation-Machinery Taxes and insurance Supervisory salaries Total costs $ 41,900 176,650 17,250 34,500 23,000 95,850 16,200 197,000 $ 308,550 302,400 602,350 $ 1,213,300 3. Compute the direct labor variance, including its rate and efficiency variances. Note: Indicate the effect of each variance by selecting favorable, unfavorable, or no variance. Round "Rate per hour" answers to two decimal places. Actual Cost Standard Cost
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