Antuan Company set the following standard costs per unit for its product. Direct materials (4.0 pounds...
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Antuan Company set the following standard costs per unit for its product. Direct materials (4.0 pounds @ $5.00 per pound) Direct labor (1.9 hours @ $13.00 per hour) Overhead (1.9 hours @ $18.50 per hour) 24 20.00 24.70 35.15 Standard cost per unit 79.85 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 $ 15,000 75,000 15,000 30,000 Indirect materials Indirect labor Power Maintenance Total variable overhead costs Fixed overhead costs 135,000 Depreciation-Building Depreciation-Machinery Taxes and insurance Supervisory salaries Total fixed overhead costs 392, 250 25,000 70,000 18,000 279, 250 $4 527,250 Total overhead costs The company incurred the following actual costs when it operated at 75% of capacity in October. Direct materials (61,000 pounds @ $5.10 per pound) Direct labor (23,000 hours @ $13.20 per hour) Overhead costs $ 311,100 303,600 $4 41,600 176, 200 17,250 34,500 25,000 94,500 16,200 279, 250 Indirect materials Indirect labor Power Maintenance Depreciation-Building Depreciation-Machinery Taxes and insurance Supervisory salaries 684,500 $ 1,299, 200 Total costs Required: 1. Prepare flexible overhead budgets for October showing amounts of each variable and fixed cost at the 65%, 75%, and 85% capacity levels. ANTUAN COMPANY Flexible Overhead Budgets Flexible Budget at Capacity Level of Variable Total For Month Ended Amount per Fixed October 31 Unit Cost 65% 75% 85% Production (in units) Variable overhead costs Antuan Company set the following standard costs per unit for its product. Direct materials (4.0 pounds @ $5.00 per pound) Direct labor (1.9 hours @ $13.00 per hour) Overhead (1.9 hours @ $18.50 per hour) 24 20.00 24.70 35.15 Standard cost per unit 79.85 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 $ 15,000 75,000 15,000 30,000 Indirect materials Indirect labor Power Maintenance Total variable overhead costs Fixed overhead costs 135,000 Depreciation-Building Depreciation-Machinery Taxes and insurance Supervisory salaries Total fixed overhead costs 392, 250 25,000 70,000 18,000 279, 250 $4 527,250 Total overhead costs The company incurred the following actual costs when it operated at 75% of capacity in October. Direct materials (61,000 pounds @ $5.10 per pound) Direct labor (23,000 hours @ $13.20 per hour) Overhead costs $ 311,100 303,600 $4 41,600 176, 200 17,250 34,500 25,000 94,500 16,200 279, 250 Indirect materials Indirect labor Power Maintenance Depreciation-Building Depreciation-Machinery Taxes and insurance Supervisory salaries 684,500 $ 1,299, 200 Total costs Required: 1. Prepare flexible overhead budgets for October showing amounts of each variable and fixed cost at the 65%, 75%, and 85% capacity levels. ANTUAN COMPANY Flexible Overhead Budgets Flexible Budget at Capacity Level of Variable Total For Month Ended Amount per Fixed October 31 Unit Cost 65% 75% 85% Production (in units) Variable overhead costs
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Related Book For
Fundamental accounting principle
ISBN: 978-0078025587
21st edition
Authors: John J. Wild, Ken W. Shaw, Barbara Chiappetta
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