6 Required Information (The following information applies to the questions displ

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6 Required Information (The following information applies to the questions displayed below. Trico Company set the following standard unit costs for its single product, 1.53 points Direct materials (30 Ibs. e $4.88 per Ib.) Direct labor (7 hrs. $14 per hr.) Factory overhead-variable (7 hrs. e s6 per $144.00 98.00 42.89 eBook hr Factory overhead-fixed (7 hrs. e s9 per hr) 63-00 Total standard cost $347.00 Print The predetermined overhead rate is based on a planned operating volume of 80% of the p units per quarter. The following flexible budget information is available. References Operating Levels 70% H 80% 46,90053,60060,309 90% Production in units Standard direct labor hours Budgeted overhead 328,300 375,200 422,18e Fixed factory overhead $3,376,8?? $3,376,800 $3,376,see Variable factory overhead $1,969,80e $2,251,200 $2,532,600 During the current quarter, the company operated at 90% of capacity and produced 60.30 labor totaled 399.200 hours. Units produced were assigned the following standard costs. Direct materials (1,809,800 Ibs. e $4.80 per Ib.) Direct labor (422,100 hrs. e s14 per hr.) Factory overhead (422,100 hrs. e si5 per hr.) Total standard cost s 8,683,200 5,909,400 6,331, 5ee $20,924,100 Actual costs incurred during the current quarter follow Direct materials (1,711,080 Ibs. e $6.30 per 1b.) Direct labor (399,200 hrs. $11.20 per hr.) 4,471,040 Fixed factory overhead costs $10,779,300 2,813,700 $21,148,140 Variable factory overhead costs Total actual costs

Explanation / Answer

Material cost variance = Std. cost for acutal production - Actual cost
= $8,683,200 - $ 10,779,300 = $2,096,100 U

Material price variance = Std. cost for actual qty - Actual Cost
= 1,711,000 lbs * $4.80 per lb - $10,779,300 = $2,566,500 U

Material usage variance = (Std. qty for acutal production - Actual qty) * Std. rate
= (1,809,000 lbs - 1,711,000 lbs) * $4.8 = $470,400 F

Labor cost variance = Std. cost - Actual cost
= $5,909,400 - $4,471,040 = $1,438,360

Labor rate variance = (Std. rate - Actual rate) * Actual hrs
=( $11.20 - $14) * 399,200 hrs = $1,117,760 U

Labor efficiency variance = (Std. hrs - Actual hrs) * Std. rate
= (422,100 hrs - 399,200 hrs) * $11.20 = $256,480 F

Overhead controllable variance = Actual overhead - Budgeted overhead
= ($2813700 + $3084100) - (53600 units * $105 per unit)
= $5897800 - $5,628,000 = $269,800 U

Fixed overhead volume variance = Absorbed fixed overhead - Budgeted fixed overhead
= (60300 units * $63 per unit) * $3,376,800 = $422,100 F

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