Direct materlals 28 bs SE perIB Direct laborno hrs 10 per

Direct materlals (28 (bs. @ SE perIB Direct laborno hrs. @ $10 per ht Factory overneadvarlable QOhrs. @ $6 perh Factony overhead fixed qo hrs @S9 perh $ 14000 10000 60.00 0 900 Total standard cost $390.00 The predetermined overhead rate is based on a planned operating volume of 70% of the productive capacity of 70,000 units per quarter. The following lexible budget Informatlon savalable Operating Levels Production in units Standard direct labor hoürs Budgeted overhead 111160% 42,000 420 0004 70% 49/000 80% 56,000 490,000$60,000 Fixed factory overhead Varlable factory overhead $4 410 004 4106004410 000 $2.520000$29401000$3 360,000 During the current quarter, the company operäted at 80 actual direct labor totaled 554.00o hours. Units produced were assigned the following standard costs: acity and produced 56,000 units of product Direct materials (1.568.000 lbs. $5perb Direct labor (560000 hrs. @ $10 per ht Factory overhead (560,000 hrs. $15 pe $ 112.840,000 5.600000 8400,000 Total standard cost Actual costs incurred during the current quarter folow Direct materials (1,563,000 Ibs. $5.10 per Direct labor (554,000 hrs, @ $9.75 per hr) Fixed factory overhead costs Varlable factory overhead costs $1 17971300 5,401,500 4.912,830 4.599,245 Total actual costs 22 884 875

Solution

Answer 1. Actual Direct Material Flexible Budget Standard Cost AQ AR Total AQ SR Total SQ SR Total          1,563,000           5.10            7,971,300          1,563,000                 5.00          7,815,000          1,568,000           5.00          7,840,000        156,300.00            25,000.00 Direct Material Price Variance        156,300.00 (U) Direct Material Quantity Variance          25,000.00 (F) Total Direct Material Variance        131,300.00 (U) Answer 2. Actual Direct Labor Flexible Budget Standard Cost AH AR Total AH SR Total SH SR Total              554,000           9.75            5,401,500              554,000              10.00          5,540,000              560,000         10.00          5,600,000        138,500.00            60,000.00 Direct Labor RAte Variance        138,500.00 (F) Direct Labor Efficiency Variance          60,000.00 (F) Total Direct Labor Variance        198,500.00 (F) Answer 3. Actual Overhead      9,512,075.00 Budgeted Overhead      8,400,000.00 Controllable Variance      1,112,075.00 (U) Answer 4. Budgeted Fixed Overhead    4,410,000.00 Fixed Overhead Cost Applied    4,986,000.00 Fixed Overhead Volume Variance        576,000.00 (F)