Problem 1: In the direct labor variance matrix, there are three factors: (1) Actual hours x Actual rate, (2) Actual hours x Standard rate, and (3) Standard hours x Standard rate. Using the numbers, indicate the formulas for each of the direct labor variances.
Problem 2: Dant Company's standard predetermined overhead rate is $6.00 per direct labor hour. For the month of June, 26,000 actual hours were worked, and 27,500 standard hours were allowed. Normal capacity hours were 28,000. How much overhead was applied?
$6.00 standard predetermined overhead rate
26,000 actual hours
27,500 standard hours
28,000 Normal capacity hours
Problem 3: If the $6.00 per hour overhead rate in question 2 consists of $4.00 variable, and actual overhead costs were $163,000, what is the overhead controllable variance for June? Is the variance favorable or unfavorable?
Problem 4. Using the data in questions 2 and 3, what is the overhead volume variance for June? Is the variance favorable or unfavorable?