The Atlas Company Has Developed Standard Overhead Costs Based Upon

question 128

Essay

The Atlas Company has developed standard overhead costs based upon a capacity of 180,000 direct labor hours: $$\begin{array} { | l | l | } \hline \text { Standard costs per unit: } & \\\hline \text { Variable portion } & 2 \text { hours } @ \$ 3 = \$ 6 \\\hline \text { Fixed portion } & 2 \text { hours } @ \$ 5 = \underline{ 10 } \\\hline & \$ 16 \\\hline\end{array}$$
During April,85,000 units were scheduled for production;however,only 80,000 units were actually produced.The following data relate to April:
Actual direct labor cost incurred was $644,000 for 165,000 actual hours of work.Actual overhead incurred totaled $1,378,000;$518,000 variable and $860,000 fixed.All inventories are carried at standard cost.Required:
(Be sure to indicate whether the variances are favorable or unfavorable. )
a.Compute the variable overhead price variance.b.Compute the variable overhead efficiency variance.

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Definitions:

Reciprocity

A social interaction principle where actions benefitting others are returned, promoting cooperation and trust.

Cheating

In biology, this refers to behaviors where individuals gain a reproductive or survival advantage at the expense of others, often violating social or mating norms.

Selfless Act

An action taken by an individual that benefits others at a cost to themselves, often discussed in the context of altruism in sociobiology.

Primary Helpers

Individuals, often offspring, who assist in the nurturing and defense of the next generation’s offspring in cooperative breeding species.