PROBLEM 11-9. Comprehensive Variance Problem [LO 2,3,4] Bowser Products operates a small plant in New Mexico that produces dog food in batches of 1,500 pounds.The product sells for $6 per pound.Standard costs for 2015 are:

Standard direct labor cost $15 per hour

Standard direct labor hours per batch 10 hours

Standard price of material A $0.35 per pound

Standard pounds of material A per batch 800 pounds

Standard price of material B $0.55 per pound

Standard pounds of material B per batch 250 pounds

Fixed overhead cost per batch $500

At the start of 2015,the company estimated monthly production and sales of 50 batches. The company estimated that all overhead costs were xed and amounted to $25,000 per month. During the month of June 2015 (typically a somewhat slow month),42 batches were produced (not an unusual level of production for June).The following costs were incurred:

Direct labor costs were $7,800 for 460 hours.

37,500 pounds of material A costing $8,500 were purchased and used.

12,000 pounds of material B costing $5,600 were purchased and used.

Fixed overhead of $23,000 was incurred.

Required

a. Calculate variances for material,labor,and overhead.

b. Prepare a summary of the variances.Does the unfavorable overhead volume variance suggest that overhead costs are out of control?