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Question: Antuan Company set the following standard costs for one unit of its product. Direct materials …

Antuan Company set the following standard costs for one unit of its product.

Direct materials (6 Ibs. @ $5 per Ib.)$30
  Direct labor (2 hrs. @ $17 per hr.)34
  Overhead (2 hrs. @ $18.50 per hr.)37
  Total standard cost$101
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% level.
Overhead Budget (75% Capacity)
  Variable overhead costs
     Indirect materials$45,000
     Indirect labor180,000
     Repairs and maintenance90,000
     Total variable overhead costs$360,000
  Fixed overhead costs
     Taxes and insurance12,000
     Total fixed overhead costs195,000
  Total overhead costs$555,000
The company incurred the following actual costs when it operated at 75% of capacity in October. 1&2. Prepare flexible overhead budgets for October showing the amounts of each variable and fixed cost at the 65%, 75%, and 85% capacity levels and classify all items listed in the fixed budget as variable or fixed. 3. Compute the direct materials cost variance, including its price and quantity variances round to 2 decimal places. 4.Compute the direct labor cost variance, including its rate and efficiency variances round actual rate to 2 decimal places 5. Prepare a detailed overhead variance report that shows the variances for individual items of overhead.
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Solution: 1& 2:

Antuan company
Flexible Overhead Budget
For month ended Oct 31
ParticularsFlexible BudgetFlexible Budget for
Variable amount per unitTotal fixed cost65% of capacity75% of capacity85% of capacity
Sales (In units)130001500017000
Variable overhead costs:
Indirect materials$3.00$39,000.00$45,000.00$51,000.00
Indirect labor$12.00$1,56,000.00$1,80,000.00$2,04,000.00
Repairs and maintenance$6.00$78,000.00$90,000.00$1,02,000.00
Total variable costs$24.00$3,12,000.00$3,60,000.00$4,08,000.00
Fixed overhead costs:
Depreciation – Building$24,000.00$24,000.00$24,000.00$24,000.00
Depreciation – Machinery$80,000.00$80,000.00$80,000.00$80,000.00
Taxes and Insurance$12,000.00$12,000.00$12,000.00$12,000.00
Total fixed costs$1,95,000.00$1,95,000.00$1,95,000.00$1,95,000.00
Total overhead costs$5,07,000.00$5,55,000.00$6,03,000.00


Since actual Cost data are not provided in Question therefore 2, 3, 4 cannot be answered. Question 1 &2 are properly answered.

Please post actual cost data for the answer of remaining questions.

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