Question

Palladium Inc. produces a variety of household cleaning products. Palladium’s controller has developed standard costs for...

Palladium Inc. produces a variety of household cleaning products. Palladium’s controller has developed standard costs for the following four overhead items:

Overhead Item Total Fixed Cost Variable Rate per Direct
Labor Hour
Maintenance $ 86,000 $0.20
Power 0.45
Indirect labor 140,000 2.10
Rent 35,000

Assume that actual production required 93,000 direct labor hours at standard. The actual overhead costs incurred were as follows:

Maintenance $107,000
Power 41,200
Indirect labor 336,000
Rent 35,000

Required:

Prepare a performance report for the period based on actual production. If an amount box does not require an entry, enter "0". Enter a favorable variance as a negative amount, and an unfavorable variance as a positive amount. If an amount is zero, enter "0" and choose "Not applicable" from the dropdown list.

Performance Report
Actual Budgeted Variance
Direct labor hours based on actual Favorable
Variable overhead:
  Maintenance $ $ $ Favorable
  Power Favorable
  Indirect labor Favorable
  Rent Unfavorable
Total overhead $ $ $ Favorabl

Homework Answers

Answer #1
Performance Report
Actual Budgeted Variance
Direct Labor Hours Based on actual      93,000.00      93,000.00
Maintenance    107,000.00    104,600.00    2,400.00 (U)
Power      41,200.00      41,850.00       650.00 (F)
Indirect Labor    336,000.00    335,300.00       700.00 (U)
Rent      35,000.00      35,000.00                 -  
Total Overhead    519,200.00    516,750.00    2,450.00 (U)
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