Direct Materials, Direct Labor, and Factory Overhead Cost Variance Analysis Mackinaw Inc. processes a base chemical into...

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Direct Materials, Direct Labor, and Factory Overhead CostVariance Analysis
Mackinaw Inc. processes a base chemical into plastic. Standardcosts and actual costs for direct materials, direct labor, andfactory overhead incurred for the manufacture of 6,800 units ofproduct were as follows:
Standard Costs Actual Costs
Direct materials 8,800 lb. at $5.60 8,700 lb. at $5.40
Direct labor 1,700 hrs. at $17.30 1,740 hrs. at $17.70
Factory overhead Rates per direct labor hr.,
based on 100% of normal
capacity of 1,770 direct
labor hrs.:
Variable cost, $3.10 $5,220 variable cost
Fixed cost, $4.90 $8,673 fixed cost
Each unit requires 0.25 hour of direct labor.
Required:
a. Determine the direct materials pricevariance, direct materials quantity variance, and total directmaterials cost variance. Enter a favorable variance as a negativenumber using a minus sign and an unfavorable variance as a positivenumber.
Direct materials price variance $
Direct materials quantity variance
Total direct materials cost variance $
b. Determine the direct labor rate variance,direct labor time variance, and total direct labor cost variance.Enter a favorable variance as a negative number using a minus signand an unfavorable variance as a positive number.
Direct labor rate variance $
Direct labor time variance
Total direct labor cost variance $
c. Determine variable factory overheadcontrollable variance, the fixed factory overhead volume variance,and total factory overhead cost variance. Enter a favorablevariance as a negative number using a minus sign and an unfavorablevariance as a positive number.
Variable factory overhead controllable variance $
Fixed factory overhead volume variance
Total factory overhead cost variance $
PART 2
Leno Manufacturing Company prepared the following factoryoverhead cost budget for the Press Department for October of thecurrent year, during which it expected to require 18,000 hours ofproductive capacity in the department:
Variable overhead cost:
   Indirect factory labor $169,200
   Power and light 8,100
   Indirect materials 43,200
      Total variable overheadcost $220,500
Fixed overhead cost:
   Supervisory salaries $77,180
   Depreciation of plant and equipment 48,510
   Insurance and property taxes 30,870
      Total fixed overheadcost 156,560
Total factory overhead cost $377,060
Assuming that the estimated costs for November are the same asfor October, prepare a flexible factory overhead cost budget forthe Press Department for November for 16,000, 18,000, and 20,000hours of production. Round your interim computations to the nearestcent, if required. Enter all amounts as positive numbers.
Leno Manufacturing Company
Factory Overhead Cost Budget-Press Department
For the Month Ended November 30
Direct labor hours 16,000 18,000 20,000
Variable overhead cost:
Indirect factory labor $ $ $
Power and light
Indirect materials
Total variable factory overhead $ $ $
Fixed factory overhead cost:
Supervisory salaries $ $ $
Depreciation of plant and equipment
Insurance and property taxes
Total fixed factory overhead $ $ $
Total factory overhead cost $ $ $

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Part 1 a Direct materials price variance Standard priceActual priceActual quantity 5605408700 1740 Favorable Direct materials quantity variance Standard quantityActual quantityStandard price 88008700560 560 Favorable Total direct materials cost variance Standard priceStandard quantityActual priceActual quantity 56088005408700 2300 Favorable Direct materials price variance 1740 Favorable Direct materials quantity variance 560 Favorable Total direct materials cost variance 2300 Favorable b Direct labor See Answer

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	Standard Costs		Actual Costs
Direct materials	8,800 lb. at $5.60		8,700 lb. at $5.40
Direct labor	1,700 hrs. at $17.30		1,740 hrs. at $17.70
Factory overhead	Rates per direct labor hr.,
	based on 100% of normal
	capacity of 1,770 direct
	labor hrs.:
		Variable cost, $3.10	$5,220 variable cost
		Fixed cost, $4.90	$8,673 fixed cost

Direct materials price variance	$
Direct materials quantity variance
Total direct materials cost variance	$

Direct labor rate variance	$
Direct labor time variance
Total direct labor cost variance	$

Variable factory overhead controllable variance	$
Fixed factory overhead volume variance
Total factory overhead cost variance	$

Variable overhead cost:
Indirect factory labor	$169,200
Power and light	8,100
Indirect materials	43,200
Total variable overheadcost		$220,500
Fixed overhead cost:
Supervisory salaries	$77,180
Depreciation of plant and equipment	48,510
Insurance and property taxes	30,870
Total fixed overheadcost		156,560
Total factory overhead cost		$377,060

Leno Manufacturing Company
Factory Overhead Cost Budget-Press Department
For the Month Ended November 30
Direct labor hours	16,000	18,000	20,000
Variable overhead cost:
Indirect factory labor	$	$	$
Power and light
Indirect materials
Total variable factory overhead	$	$	$
Fixed factory overhead cost:
Supervisory salaries	$	$	$
Depreciation of plant and equipment
Insurance and property taxes
Total fixed factory overhead	$	$	$
Total factory overhead cost	$	$	$