Question

A manufactured product has the following information for June. Direct materials Direct labor Overhead Units manufactured Standard (6 lbs. esper lb.) (2 hrs. @ $16 per hr.) (2 hrs. $12 per hr.) Actual 47,200 lbs. @ $7.20 per lb. 15,300 hrs. $16.40 per hr. $ 193,600 7,800 (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 varianco.

Answer 1

Ans:

Statement showing computations
Particulars	Standard pu
Standard Cost per unit:
Direct Materials = 6* 7	42.00
Direct Labour = 2 *16	32.00
Overhead = 2*12	24.00
Total Standard Cost per unit	98.00
Statement showing computations
Particulars	Standard cost of 7800 Units	Actual cost	Cost Variance	Comments
Total Cost :
Direct Materials = 42 * 7800 , 47200*7.20	327600	339840	(12240)	Unfavourable
Direct Labour = 32*7800 and 15300*16.40	249600	250920	(1320)	Unfavourable
Overhead = 24*7800 and 193600	187200	193600	(6,400)	Unfavourable
Total Cost :	764400	784360	(19960)	Unfavourable

Total Cost Variance=19,960 unfavorable

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