Antuan Company set the following standsrd costs for one unit of product. Direct

Question

Antuan Company set the following standsrd costs for one unit of product. Direct naterials (3.8 Ibs.$5.08 per Ib Direct labor (1.7 hrs. 11.80 per hr.) 18.78 overhead (1.7 hrs. @ $18.se per hr.) -31.45 Total standard cost 15.03 The predetermined overhead rste8.50 per direct labor hourla based on an expected volume of 75% of the factory's capscity of 20,000 units per month. Folowing rethe company's budgeted overhead costs per month at the 75% cspchy evel Overhead Budget (75% Capacity) Variable overhead costs Indirect labor 75,803 15,803 Repairs and maintenance Total variable overhead costs 135,08 Fixed overhead costs Taxes and insurance Supervision Total fixed overhead costs 24,863 18,803 222 758 336 75e 471,758 Total owerhead costs The company incurred the following 5ctus l costs when t opersted st 75% of cspschty In October Direct materials 46, eee lbs. @ $5.20 per 1b.) Direct labor (29.eee hrs. @11.48 per hr Overhead casts 239,200 338,683 41,7568 176,558 17,250 34,588 24,080 97,280 16,280 Indirect naterials Indirect labor Repairs and maintenance Depreciation Building Depreciation-Machinery Taxes and insurance Supervision 222,758 3,2a Total costs 4. Compute the direct labar cost varlsnce, Including ts rate and eficlency varisnces

Explanation / Answer

actual output =20000*75%= 15000 total direct labor cost variance actual - flexible budgeted 330,600 - 15000*18.70 50,100 U direct labor rate variance (Actual rate - standard rate )*actual hours (11.40-11)*29000 11600 U labor rate efficiency variance (actual hours - standard hr)*standard rate (29000 - 15000*1.7)*11 38,500 U

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