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Standard Costing

Poochy Pride Corporation produces dog food. The company's standard cost and annual budget information are as follows:

Standard Costs per Case

Direct material (20 pounds at $2) $ 40.00
Direct labor (5 hours at $18) 90.00
Variable overhead (5 hours at $1.50) 7.50
Fixed overhead (5 hours at $3) 15.00
Total $152.50

Annual Budget Information

Variable overhead $150,000
Fixed overhead $300,000
Planned activity for year 100,000 direct labor hours

During October, Poochy Prtide produced 1,450 cases of dog food and incurred the following actual costs:

Actual labor cost (8,000 direct labor hours) $151,200
Actual material cost (30,000 pounds purchased and used) 66,000
Variable overhead 11,000
Fixed overhead 26,000

Required:

Prepare as complete and analysis of cost variances as is possible from the available data. Be sure to indicate whether the variance is favorable (F) or unfavorable (U).

Solution Summary

Excel file contains s computation and analysis of cost variances.

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