Question
A company uses the following standard costs to produce a single unit of output. Direct materials 8 pounds at $0.80 per pound=$6.40 Direct labor 0.40
A company uses the following standard costs to produce a single unit of output.
Direct materials 8 pounds at $0.80 per pound=$6.40
Direct labor 0.40 hour at $10.00 per hour=$4.00
Manufacturing overhead. 0.40 hour at $3.20 per hour=$1.28
During the latest month, the company purchased and used 77,000 pounds of direct materials at a price of $1.1 per pound to produce 10,000 units of output. Direct labor costs for the month totaled $37,636 based on 3,880 direct labor hours worked. Variable manufacturing overhead costs incurred totaled $8,800 and fixed manufacturing overhead incurred was $11,000. Based on this information, the direct labor rate variance for the month was:
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