Required information The following information applies to the questions displaye

Question

Required information The following information applies to the questions displayed below A manufactured product has the following information for June. (5 lbs. $8 per 1b.) (2 hrs. $16 per hr) 17,300 hrs. $16.50 per hr. (2 hrs. $11 per hr. $199,600 44,500 1bs. $8.10 per lb. Direct materials Direct labor Overhead Units manufactured 8, 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 variance

Explanation / Answer

1) Compute standard cost per unit :

2) Compute total cost variance :

Actual cost = (44500*8.10+17300*16.50+199600) = 845500

Standard cost = 8800*94 = 827200

Total cost variance = 827200-845500 = 18300 Unfavorable

Direct material (5*8) 40 Direct labour (2*16) 32 Overhead (2*11) 22 Total 94

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