Required information

Problem $8-3$A $($Algo$)$ Flexible overhead budget; materials, labor, and overhead variances; and overhead

variance report LO P$1,$ P$2,$ P$3,$ P$4$

$[$The following information applies to the questions displayed below.$]$

Antuan Company set the following standard costs per unit for its product.

Direct materials $(4\mathrm{.}0$ pounds $$4\mathrm{.}00$ per pound$)$

Direct labor $(1\mathrm{.}7$ hours & $$10\mathrm{.}00$ per hour$)$

Overhead $(1\mathrm{.}7$ hours if $$18\mathrm{.}50$ per hour$)$

standard cost per unit

The standard overhead rate $($ $$18\mathrm{.}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

Taxes and insurance

Supervisory salaries

Total fixed overhead costs

Total overhead costs

The company incurred the following actual costs when it operated at $75\%$ of capacity in October.

Direct materials $(60,500$ pounds $(4)$ $$4\mathrm{.}20$ per pound$)$

Direct labor hours $$10\mathrm{.}30$ per hour$)$

Overhead costs

Indirect materials

Indirect labor

Power

Maintenance

Depreciation$-$Building

Depreciation$-$Machinery

Taxes and insurance

Supervisory salaries

Total costs

$$254,100$

$226,600$

$$41,050$

$176,350$

$17,250$

$34,500$

$23,000$

$94,500$

$15,300$

$211,750$

$613,700$

$$1,094,400$

Problem $8-3$A $($Algo$)$ Part $3$

Compute the direct labor variance, including its rate and efficiency variances.

Note: Indicate the effect of each variance by selecting favorable, unfavorable, or no variance. Round "Rate per hour" answers to

two decimal places.