Question

Required information (The following information applies to the questions displayed below.) A manufactured product has the following information for June. Direct materials Direct labor Overhead Units manufactured Standard (6 lbs. @ $8 per lb.) (2 hrs. $17 per hr.) (2 hrs. $12 per hr.) Actual 52,200 lbs. @ $8.10 per lb. 16,900 hrs. $17.60 per hr. $212,200 8,600 (1) Compute the standard cost per unit. Direct materials Direct labor Overhead Total (2) Compute the total cost variance for June. Indicate whether the cost variance is favorable or unfavorable. Total cost variance

Answer 1

Standard cost computation Material - 6 lbs 412800 1 unit = (51600Lbs x $8) Direct Labows S [2 bows X 8600X17 2 92400 Overhead g hours x 8600 units 206400 $12) - a Total cost (A) Numbers of units (B) e Cost per unit (A&B) 1 9 11600 .8600 106 @ Computation of total cost Varuanne se Standard. cost -- ActualCost 4H16001 52747607-336 al1600% 932460 Ga (20860 ( Unfavourable)

Material poin variance .. _ (SP - AP) AQ _ (8 - 8.1) 52200 = 5220 (0)) Material Usage Variante -AQ) SP (51600 - 52200) 8 4800 (0) Labour Rate Variance - AR) AH ( 17 – 17.6) 16900 1014010)] Labour effiüenty Vavuanie (SH -AH) SR. 1 268600) – 16900] 17 292400 - 289300 5.100 (7)

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