Antuan Company set the following standard costs for one unit of Its product Dire
ID: 2469495 • Letter: A
Question
Antuan Company set the following standard costs for one unit of Its product Direct materla's (3.0 lbs. Direct labor (2.0 hrs. $12.0 per hr) Overhead (2.0 hrs. $18.50 per hr.) $4.0 per lb. 12.00 24.00 37.00 Total standard cost $ 73.00 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% level. Overhead Budget (75% Capacity) Variable overhead costs Ind rect materia's Ind rect labor Power Repairs and maintenance $ 15,000 75,000 15,000 45,000 Total variable overhead costs $150,000 Fixed overhead costs 23,000 74,000 7,000 291,000 Taxes and Insurance Total fixed overhead costs 405,000 Total overhead costs $555,000 The company incurred the following actual costs when it operated at 75% of capacity in October. Direct materials (46,000 lbs. @ $4.10 per lb.) Direct labor (29,000 hrs. $12.40 per hr) Overhead costs $ 188,600 $ 45.750 177,250 17,250 51,750 23,000 99,900 15,300 291,000 Ind rect materia's Ind rect labor Repairs and maintenance Taxes and insurance 721,200 Total costs $1,269,400Explanation / Answer
Solution :
solution
Flexible
Actual
Variance
Fav/Unfav
Variable costs
Indirect materials
15,000
45,750
- 30,750
Unfavourable
Indirect labor
75,000
177,250
- 102,250
Unfavourable
Power
15,000
17,250
- 2,250
Unfavourable
Repairs and maintenance
45,000
51,750
- 6,750
Unfavourable
Total variable costs
150,000
292,000
- 142,000
Unfavourable
Fixed costs
Depreciation—Building
23,000
23,000
-
Depreciation—Machinery
74,000
99,900
- 25,900
Unfavourable
Taxes and insurance
17,000
15,300
1,700
favourable
Supervision
291,000
291,000
-
Total fixed costs
405,000
429,200
- 24,200
Unfavourable
Total overhead costs
555,000
721,200
- 166,200
Unfavourable
expected production volume
15000
production level achieved
15000
volume variance
0
solution
Flexible
Actual
Variance
Fav/Unfav
Variable costs
Indirect materials
15,000
45,750
- 30,750
Unfavourable
Indirect labor
75,000
177,250
- 102,250
Unfavourable
Power
15,000
17,250
- 2,250
Unfavourable
Repairs and maintenance
45,000
51,750
- 6,750
Unfavourable
Total variable costs
150,000
292,000
- 142,000
Unfavourable
Fixed costs
Depreciation—Building
23,000
23,000
-
Depreciation—Machinery
74,000
99,900
- 25,900
Unfavourable
Taxes and insurance
17,000
15,300
1,700
favourable
Supervision
291,000
291,000
-
Total fixed costs
405,000
429,200
- 24,200
Unfavourable
Total overhead costs
555,000
721,200
- 166,200
Unfavourable
expected production volume
15000
production level achieved
15000
volume variance
0
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.