Question

Antuan Company set the following standard costs for one unit of its product. Direct materials (4.0 Ibs. @ $6.00 per Ib.) Direct labor (1.8 hrs. @ $11.00 per hr.) Overhead (1.8 hrs. @ $18.50 per hr.) Total standard cost $24.00 19.80 33.30 $77.10 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 $ 30,000 Indirect labor 75,000 Power 30,000 Repairs and maintenance 30,000 Total variable overhead costs Fixed overhead costs Depreciation-Building 25,000 Depreciation-Machinery 72,000 Taxes and insurance 18,000 Supervision 219,500 Total fixed overhead costs Total overhead costs $165,000 334,500 $499,500

Answer 1

SR Actual Cost AH x L 22000 DX 246400 AR 11.20 AH 22000 Standard Cost SH X SR 27000 X 11.00 297000 11.00 | 242000 4400 55000 Direct Labor Rate Varaince 4400 Unfavorable Direct Labor Efficiency Variance 55000 Favorable Total Direct Labor Variance 50600 Favorable Factory Capacity =20,000 Units 75% Capacity = 20,000*75% StandardHours= SH For 1 Units * Total Prodcued = (15000*1.80) 15000 27000