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Antuan Company set the following standard costs per unit for its product. $ 12.00 Direct materials (3.0 pounds @ $4.00 per pound) Direct labor (1.8 hours @ $12.00 per hour) Overhead (1.8 hours @ $18.50 per hour) 21.60 33.30 Standard cost per unit $ 66.90 The standard overhead rate ($18.50 per direct labor hour) is based on a predicted activity level 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. $ 15,000 Indirect labor 75,000 Power 15,000 Maintenance 30,000 135,000 Total variable overhead costs Fixed overhead costs 24,000 Depreciation-Building Depreciation-Machinery Taxes and insurance 70,000 16,000 Supervisory salaries. 254,500 Total fixed overhead costs 364,500 Total overhead costs $ 499,500 The company incurred the following actual costs when it operated at 75% of capacity in October. Direct materials (46,000 pounds @ $4.20 per pound) Direct labor (19,000 hours @ $12.10 per hour) $ 193,200 229,900 Overhead costs. $ 41,700 Indirect materials. Indirect labor 176,600 Power 17,250 Maintenance 34,500 Depreciation-Building 24,000 94,500 Depreciation-Machinery Taxes and insurance Supervisory salaries. 14,400 254,500 657,450 Total costs $ 1,080,550

Antuan Company set the following standard costs per unit for its product. $ 12.00 Direct materials (3.0 pounds @ $4.00 per pound) Direct labor (1.8 hours @ $12.00 per hour) Overhead (1.8 hours @ $18.50 per hour) 21.60 33.30 Standard cost per unit $ 66.90 The standard overhead rate ($18.50 per direct labor hour) is based on a predicted activity level 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. $ 15,000 Indirect labor 75,000 Power 15,000 Maintenance 30,000 135,000 Total variable overhead costs Fixed overhead costs 24,000 Depreciation-Building Depreciation-Machinery Taxes and insurance 70,000 16,000 Supervisory salaries. 254,500 Total fixed overhead costs 364,500 Total overhead costs $ 499,500 The company incurred the following actual costs when it operated at 75% of capacity in October. Direct materials (46,000 pounds @ $4.20 per pound) Direct labor (19,000 hours @ $12.10 per hour) $ 193,200 229,900 Overhead costs. $ 41,700 Indirect materials. Indirect labor 176,600 Power 17,250 Maintenance 34,500 Depreciation-Building 24,000 94,500 Depreciation-Machinery Taxes and insurance Supervisory salaries. 14,400 254,500 657,450 Total costs $ 1,080,550

Managerial Accounting: The Cornerstone of Business Decision-Making
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter10: Standard Costing And Variance Analysis
Section: Chapter Questions
Problem 72P: Moleno Company produces a single product and uses a standard cost system. The normal production...
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Antuan Company set the following standard costs per unit for its product. $ 12.00 Direct materials (3.0 pounds @ $4.00 per pound) Direct labor (1.8 hours @ $12.00 per hour) Overhead (1.8 hours @ $18.50 per hour). 21.60 33.30 Standard cost per unit $ 66.90 The standard overhead rate ($18.50 per direct labor hour) is based on a predicted activity level 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 $ 15,000 Indirect labor 75,000 Power 15,000 Maintenance 30,000 135,000 Total variable overhead costs Fixed overhead costs 24,000 Depreciation-Building Depreciation-Machinery 70,000 Taxes and insurance 16,000 Supervisory salaries. 254,500 Total fixed overhead costs 364,500 Total overhead costs $ 499,500 The company incurred the following actual costs when it operated at 75% of capacity in October. Direct materials (46,000 pounds @ $4.20 per pound) Direct labor (19,000 hours @ $12.10 per hour) $ 193,200 229,900 Overhead costs Indirect materials $ 41,700 Indirect labor 176,600 Power 17,250 Maintenance 34,500 24,000 Depreciation-Building Depreciation-Machinery 94,500 14,400 Taxes and insurance Supervisory salaries. 254,500 657,450 Total costs $ 1,080,550
Transcribed Image Text:Antuan Company set the following standard costs per unit for its product. $ 12.00 Direct materials (3.0 pounds @ $4.00 per pound) Direct labor (1.8 hours @ $12.00 per hour) Overhead (1.8 hours @ $18.50 per hour). 21.60 33.30 Standard cost per unit $ 66.90 The standard overhead rate ($18.50 per direct labor hour) is based on a predicted activity level 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 $ 15,000 Indirect labor 75,000 Power 15,000 Maintenance 30,000 135,000 Total variable overhead costs Fixed overhead costs 24,000 Depreciation-Building Depreciation-Machinery 70,000 Taxes and insurance 16,000 Supervisory salaries. 254,500 Total fixed overhead costs 364,500 Total overhead costs $ 499,500 The company incurred the following actual costs when it operated at 75% of capacity in October. Direct materials (46,000 pounds @ $4.20 per pound) Direct labor (19,000 hours @ $12.10 per hour) $ 193,200 229,900 Overhead costs Indirect materials $ 41,700 Indirect labor 176,600 Power 17,250 Maintenance 34,500 24,000 Depreciation-Building Depreciation-Machinery 94,500 14,400 Taxes and insurance Supervisory salaries. 254,500 657,450 Total costs $ 1,080,550
Expected production volume Production level achieved Volume Variance Variable overhead costs Fixed overhead costs Total overhead costs Volume Variance Volume variance Total overhead variance ANTUAN COMPANY Overhead Variance Report For Month Ended October 31 Flexible Budget Actual Results Variances Favorable/Unfavorable 12 $ 0
Transcribed Image Text:Expected production volume Production level achieved Volume Variance Variable overhead costs Fixed overhead costs Total overhead costs Volume Variance Volume variance Total overhead variance ANTUAN COMPANY Overhead Variance Report For Month Ended October 31 Flexible Budget Actual Results Variances Favorable/Unfavorable 12 $ 0
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