Reference no: EM1341139

Textile Express Company Labor and Overhead Variances

Calculating Labor and Overhead Variances

At the start of 2012, Textile Express Company determined its standard labor cost to be 2.5 hours per unit at $33.90 per hour. The budget for variable overhead was $9 per unit, and budgeted fixed overhead was $15,000 for the year. Expected annual production was 5,000 units. During 2012, the actual cost of labor was $34.30 per hour. Textile Express produced 4,840 units requiring 11,800 direct labor hours. Actual overhead for the year was $48,820.

Calculate labor rate and efficiency variances and the controllable overhead variance and the overhead volume variance. (Round calculations to 2 decimal places, e.g. 25.21 and the final answers to 0 decimal places, e.g. 5,250. For negative numbers use either a negative sign preceding the number, e.g. -45 or parenthesis, e.g. (45).)

Labor Rate Variance $ ______ favorable or unfavorable
Labor Efficiency Variance $______ unfavorable or favorable
Controllable Overhead Variance $_______ favorable or unfavorable
Overhead Volume Variance $______ unfavorable or favorable