(Answered) : ABC Dress Shop produces high quality formal dresses. In July 2018 they produced 16,000 dresses. For the month of July the follow

ABC Dress Shop produces high quality formal dresses. In July 2018 they produced 16,000 dresses. For the month of July the following standard and actual cost data are available. The normal monthly capacity of the company is 40,000 direct labor hours. All material purchased in July was used in July production.

Standard per Dress

Actual

Direct materials

5.0 yards @ $8.50 per yard

$643,250 for 83,000 yards

Direct labor

2.0 hours @ $12.00 per hour

$425,000 for 34,000 hours

Overhead

hours @ $5.15 per hour

(fixed $3.25; variable $1.90)

$125,000 fixed overhead

$49,000 variable overhead

Overhead is applied on the basis of direct labor hours. At normal capacity, budgeted fixed overhead costs are $130,000