Reference no: EM132715071
The standard cost sheet for Chambers Company, which manufactures one product, follows:
Direct materials, 40 yards at $2.00 per yard $80
Direct labor, 5 hours at $20 per hour 100
Factory overhead applied at 80% of direct labor 80 (variable costs = $60; fixed costs = $20)
Variable selling and administrative 64
Fixed selling and administrative 40
Total unit costs$364
Standards have been computed based on a master budget activity level of 28,800 direct labor-hours per month. Actual activity for the past month was as follows:
Materials used 228,000yards at $2.05 per yard
Direct labor 25,200hours at $20.40 per hour
Total factory overhead$444,000
Production 5,000units
Required:
Problem 1: Prepare variance analyses for the variable and fixed costs. (Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.)