Chapter 23 team discussion problem *** I'm part 2 65%***

Problem 23-5A; parts 1 & 2 only (p. 982 of the textbook, and reproduced below)

• Individually complete either part 1, or a flexible overhead budget for one capacity scenario in part 2. For our purposes, choose a capacity scenario of either55%, 65%, or 85% (there is no need to complete the 75% scenario, as it already presented in the problem). Be sure to show all calculations in detail for full credit.

IMPORTANT INSTRUCTIONS:

1. Navigate to your Group Homepage by hovering your cursor over our course at the Courses dropdown menu at the top of this page. Use yourGroup'sAnnouncement tool to decide among your teammates who will work on which part (part 1, or one of the three capacity scenarios (55%, 65%, or 85%) in part 2).

2. Once your roles are agreed, post your solution to your part in your group's Discussion forum. For full credit, be sure to comment on your teammates' posts.

Problem 23-5A

Antuan Company set the following standard costs for one unit of its product.

The predetermined overhead rate ($18.50 per direct labor hour) is based on an expected volume of 75% of the factory's capacity of 20,000 units per month. Following are the company's budgeted overhead costs per month at the 75% level.

The company incurred the following actual costs when it operated at 75% of capacity in October.

Required

1. Examine the monthly overhead budget to (a) determine the costs per unit for each variable overhead item and its total per unit costs, and (b) identify the total fixed costs per month.

2. Prepare flexible overhead budgets (as in Exhibit 23.12) for October showing the amounts of each variable and fixed cost at the 55%, 65%, and 85%capacity levels.