Question

HYEUVROUE [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 7 lbs. 2 hrs. 2 hrs. Standard $9 per lb. $16 per hr. $11 per hr. Actual 59,400 lbs. $9.10 per lb. 16,400 hrs. $16.50 per hr. $190,200 8,400 (1) Compute the standard cost per unit. (2) Compute the total cost variance for June. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the standard cost per unit. Direct materials Direct labor Overhead

Answer 1

Solution:

1a) Calculate the standard cost per unit for direct material

Direct material = cost per lbs * Total lbs per unit

=$9*7

=$63

1b) Calculate the standard cost per unit for direct lobor

Direct labor = Cost per hour * Total hours per unit

=$16*2

=$32

1c) Calculate the standard cost per unit for overhead

Overhead = cost per hour * Total hours per unit

=$11 * 2

=$22

2)

Calculate the total standard cost

Particular	Amount $
Direct materials cost(8,400*9*7)	529,200
Add: Direct lanor costs(8,400*16*2)	268,800
Add: Overhead costs(8,400 *11*2)	184,800
Total standard cost	982,800

Calculate the total actual cost

Particular	Amount $
Direct materials cost(59,400*9.10)	540,540
Add: Direct lanor costs(16,400 * 16.5)	270,600
Add: Overhead costs	190,200
Total Actual cost	1,001,340

Total cost variance = Total actual cost - Total standard cost

=1,001,340 -982,800

=$18,540 unfavorable