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Standard Costing

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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).

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Solution Summary

Excel file contains s computation and analysis of cost variances.

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