Homework SourseA manufactured product has the following information for Jun
A manufactured product has the following information for June.
1. Compute the standard cost per unit.
2. Compute the total cost variance for June. Indicate whether the cost variance is favorable or unfavorable.
| Standard | Actual | |||
| Direct materials | (6 lbs. @ $8 per lb.) | 48,500 | lbs. @ $8.10 per lb. | |
| Direct labor | (2 hrs. @ $16 per hr.) | 15,700 | hrs. @ $16.50 per hr. | |
| Overhead | (2 hrs. @ $12 per hr.) | $ | 198,000 | |
| Units manufactured | 8,000 |
Solution
1.
2.
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| Data for calculation of Variance | |||||||||
| Standard | Standard Cost for 8000 Units | Actual for 8000 Units | |||||||
| Units | Rate | Total | Units | Rate | Total | Units | Rate | Total | |
| Material | 6 | 8.00 | 48.00 | 48,000.00 | 8.00 | 384,000.00 | 48,500.00 | 8.10 | 392,850.00 |
| Labour | 2 | 16.00 | 32.00 | 16,000.00 | 16.00 | 256,000.00 | 15,700.00 | 16.50 | 259,050.00 |
| Ovehead | 2 | 12.00 | 24.00 | 16,000.00 | 12.00 | 192,000.00 | 15,700.00 | 12.61 | 198,000.00 |
