Question

3. [The following information applies to the questions displayed below.]

A manufactured product has the following information for June.

	Standard	Actual
Direct materials	6 lbs. @ $8 per lb.		52,700	lbs. @ $8.20 per lb.
Direct labor	2 hrs. @ $16 per hr.		17,100	hrs. @ $16.60 per hr.
Overhead	2 hrs. @ $11 per hr.	$	196,500
Units manufactured			8,700

(1) Compute the standard cost per unit.
(2) Compute the total cost variance for June.

Direct Materials _______

Direct Labor ________

Overhead _______

Total _______

Total Cost Variance _______

Answer 1

1) standard cost per unit
Direct material (6lbs*8 per lbs )			48
direct labor (2 hrs*16 per hr)			32
overhead (2hrs*11 per hr)			22
total			102
2) total cost variance
Direct material (52700*8.20)			432140
direct labor (17100*16.60)			283860
overhead			196500
total actual manufacturing cost			912500
standard cost
direct material (6*8*8700)			417600
direct labor (2*16*8700)			278400
overhead (2*11*8700)			191400
total standard manufacturing cost			887400
calculation of total cost variance
total actual manufacturing cost			912500
less: total standard manufacturing cost			887400
total cost variance -UNFAVORABLE			25100

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