l Pre-Built Problems Help Sav Trico Company set the following standard unit cost
ID: 2516934 • Letter: L
Question
l Pre-Built Problems Help Sav Trico Company set the following standard unit costs for its singie product. Direct materials (30 Ibs. $4.80 per Ib. Direct labor (6 hrs. $14 per hr. Factory overhead-variable (6 hrs. $7 per hr. Factory overhead-tixed (6 hr. $12 per hr. Total standard cost $144.00 B4.00 42.00 72.00 $342.00 The predetermined overhead rate is based on a planned operating volume of 80% of the productive capacity of 66,000 units per quarter. The following flexible budget information is available. Operating Levels 808 52,800 316,800 90% Production in units Standard direct labor hours Budgeted overhead 46,200 277,200 59, 400 356,400 Fixed factory overhead Variable factory overhead $3, 801,6003,801,600 $3,801,600 $1,940,400 $2,217,600 $2,494,800 During the current quarter, the company operated at 90% of capacity and produced 59,400 units of product actual direct labor totaled 303.800 hours. Units produced were assigned the following standard costs. Direct nateriala (1,782,000 Ib. $4.80 per Ib-) Direet labor (356,400 hrs. $14 per hr. Factory averhead (356,400 hra $19 per hr.6,771,600 Total standard cost 8,553,600 ,989,600 820,314,800 Actual costs incurred during the current quarter follow. Prev 8 of 8 NextExplanation / Answer
Answer:
3.
Controllable varience = Actual total overhead incurred - Budgeted total overhead at 90% capacity
Actual total overhead incurred = actual variable overhead + actual fixed overhead
Actual total overhead incurred = $2,336,900 + $2,637,700
= $4,974,600.
Budgeted total overhead at 90% capacity = $3,801,600 + $2,494,800 = $6,296,400
Controllable varience = $4,974,600 - $6,296,400
= $1,321,800.(Favorable)
Volume varience = Budgeted fixed overhead - Actual fixed overhead
Volume varience = $3,801,600 - $2,336,900
= $1,464,700.(Favorable)
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