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13. Chair Company (CC) has provided the following standard cost sheet. Chair Company Standard Cost Sheet - Plastic Chair Direct materials (plastic) - pounds Direct
13. Chair Company (CC) has provided the following standard cost sheet. Chair Company Standard Cost Sheet - Plastic Chair Direct materials (plastic) - pounds Direct labor (molders) - direct labor hours Direct labor (finishers) - direct labor hours Variable manufacturing overhead - total DLH Fixed manufacturing overhead - total DLH Total Cost to Manufacture Variable selling overhead - chairs Total Cost to Deliver Input Quantity Cost per Input Cost per Chair 4.0 pounds $12 per pound $48.00 0.5 DLH $20.00 per DLH 1.0 DLH $25.00 per DLH 1.5 DLH $5.00 per DLH 1.5 DLH $7.50 per DLH $10.00 $25.00 $7.50 $11.25 $101.75 I chair $5.00 per chair $5.00 $106.75 5 Note that the input quantity multiplied by the cost per input equals cost per chair. Also note in this case that manufacturing overhead (MOH) costs are being allocated on the basis of total direct labor hours (DLH). CC also disclosed the following actual information: 5,000 pounds of plastic was purchased for $63,750, of which 4,600 was used in production. Molders were paid a total of $10,500 to work 575 hours and finishers were paid a total of $29,000 to work 1,050 hours. 1,100 plastic chairs were produced and sold during the year. What is the direct labor rate variance based on the above information? $1,750 Unfavorable $1,750 Favorable $750 Unfavorable $750 Favorable
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