Extra credit question 8

Problem 8-3A (Algo) Flexible overhead budget; materials, labor, and overhead variances; and overhead variance report LO P1, P2, P3, P4 [The following information applies to the questions displayed below.] Antuan Company set the following standard costs per unit for its product. Direct materials (3.0 pounds @ $5.00 per pound) Direct labor (1.7 hours @ $12.00 per hour) Overhead (1.7 hours @ $18.50 per hour) Standard cost per unit $ 15.00 20.40 31.45 $ 66.85 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 Indirect materials Indirect labor Power Maintenance Total variable overhead costs Fixed overhead costs Depreciation-Building Depreciation Machinery $ 15,000 75,000 15,000 30,000 135,000 25,000 70.000 Depreciation-Machinery Taxes and insurance Supervisory salaries Total fixed overhead costs Total overhead costs 70,000 18,000 223,750 336,750 $ 471,750 The company incurred the following actual costs when it operated at 75% of capacity in October. $ 236,600 278,300 Direct materials (45,500 pounds @ $5.20 per pound) Direct labor (23,000 hours @ $12.10 per hour) Overhead costs Indirect materials Indirect labor Power Maintenance Depreciation-Building Depreciation-Machinery Taxes and insurance Supervisory salaries Total costs $ 41,500 176,300 17,250 34,500 25,000 94,500 16,200 223,750 629,000 $ 1,143,900 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 Amount Total Fixed Cost 65% 75% 85% For Month Ended October 31 per Unit Production (in units) Variable overhead costs Fixed overhead costs Fixed overhead costs Total overhead costs