Problem 21-4B Computing materials, labor, and overhead variances P3 P4 Kryll Company set the following standard costs per unit for its single product. Direct materials (25 lbs. @ $4 per lb.)... Direct labor (6 hrs. @ $8 per hr.). Variable overhead (6 hrs. @ $5 per hr.).. Fixed overhead (6 hrs. @ $7 per hr.). Standard cost per unit. $100 48 30 42 $220 Overhead is applied using direct labor hours. The standard overhead rate is based on a predicted activity level of 80% of the company's capacity of 60,000 units per quarter. The following additional information is available. Capacity Level 70% Production (in units) ... 42,000 units Standard direct labor hours (6 DLH/unit) ... 252,000 hrs. Budgeted overhead (flexible budget) 80% 48,000 units 288,000 hrs. 90% 54,000 units 324,000 hrs. Fixed overhead Variable overhead $2,016,000 $2,016,000 $2,016,000 $1,260,000 $1,440,000 $1,620,000 During the current quarter, the company operated at 70% of capacity and produced 42,000 units; direct labor hours worked were 250,000. Units produced were assigned the following standard costs. Actual costs incurred during the current quarter follow. Direct materials (1,050,000 lbs. @ $4 per lb.) Direct labor (252,000 hrs. @ $8 per hr.). Overhead (252,000 hrs. @ $12 per hr.) Standard (budgeted) cost.. $4,200,000 2,016,000 3,024,000 $9,240,000