Managerial Accounting: PR23-3B SureGrip Tire Co. manufactures automobile tires

Managerial Accounting 
PR23-3B Direct materials, direct labor, and factory overhead cost variance analysis 
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: 
Standard Costs Actual Costs 
Direct materials 68,000 pounds at $4.80 72,100 pounds at $5.20 
Direct labor 15,600 hours at $16.00 15,400 hours at $15.70 

Factory overhead Rates per direct labor hour, 
based on 100% of normal 
capacity of 21,000 direct 
labor hours: 
Variable cost, $2.70 $41,650 variable cost 
Fixed cost, $3.65 $76,650 fixed cost 
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 cost variance.
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