SureGrip Tire Co. manufactures automobile tires. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of 39,000 tires were as follows:

Each tire requires 0.40 hour of direct labor.
Instructions
Determine
(a) The price variance, quantity variance, and total direct materials cost variance;
(b) The rate variance, time variance, and total direct labor cost variance; and (c) Variable factory overhead controllable variance, the fixed factory overhead volume variance, and total factory overhead costvariance.

Transcribed Image Text:

Standard Costs Actual Costs Direct materials Direct labor Factory overhead 68,000 pounds at $4.80 15,600 hours at $16.00 Rates per direct labor hour, based on 100% of normal capacity of 21,000 direct labor hours: 72,100 pounds at $5.20 15,400 hours at $15.70 Variable cost, $2.70 Fixed cost, $3.65 $41,650 variable cost $76,650 fixed cost