Question

A manufactured product has the following information for August. Actual Direct materials Direct labor Overhead Units manufactured Total manufacturing costs Standard 2 lbs. per unit @ $2.50 per lb. 0.5 hours per unit @ $16 per hour $12 per direct labor hour 12,000 $225,400 (1) Compute the standard cost per unit. (2) Compute the total budgeted cost for production in August. (3) Compute the total cost variance for August. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute the standard cost per unit. Direct materials Direct labor Overhead Total

Answer 1

Direct materials (2*2.50)	5
Direct labor (0.5*16)	8
Overhead (12*0.5)	6
Total	19

.

Total budgeted cost = 19*12,000

= 228,000

.

Cost variance = 228,000 - 225,400

= 2600 Favourable

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