Variance Analysis

Obj. $3,4$

Santiago Inc. processes a base chemical into plastic. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of $40,000$ units of product were as follows:

$\backslash$table$[[,$Standard Costs,Actual Costs$],[$Direct materials,$240,000lbs.$ at $$6\mathrm{.}40$ per lb$.,237,000lbs.$ at $$6\mathrm{.}50$ per lb$.],[$Direct labor,$12,000hrs.$ at $$24\mathrm{.}20$ per $hr.,11,500hrs.$ at $$25\mathrm{.}00$ per $hr.],[\backslash$table$[[$Factory$],[$overhead$]],$Rates per direct labor hr$.,,],[$based on $100\%$ of normal,$],[$capacity of $15,000$ direct,$]]$