AS N er vi goodt i gang uses standard costs in its operating accounts. In production department 1 (T1) all direct materials are added at

AS "Nå er vi goodt i gang" uses standard costs in its operating accounts. In production department 1 (T1)
all direct materials are added at the beginning of the manufacturing process. Direct salary and indirect
manufacturing costs accrue evenly throughout the entire manufacturing process in T1.

 

The following standard calculation is available:

Direct materials
Number of kilos	6,0 kg
Price per kilo	kr 20,00
Direct salary
Number of hours	1 hour
Salary per hour	kr 120
Indirect manufacturing costs	120 kr per hour
Standard fare T1	Kr 380

The following activity was registered in the month of December:

Incoming balance goods in work	300 pieces
These were	80% fully manufactured
Finished production in the period	2 500 pieces
Closing Balance goods in work	600 pieces
Disse var	40% fully manufactured

 

The following cost information was recorded for T1 in the month of December:

Direct salary	kr 367 354
Direct labor hours	2 587 hours
Material consumption in kg	16 020 kg
Material cost	kr 312 390

QUESTION : Calculate the wage discrepancy, wage rate discrepancy and time discrepancy. Discuss what the reasons for the individual deviations may be.

Standard labor cost
Actual labor cost
Total discrepancy

Real labor cost per unit
Wage rate deviation
The time deviation
Total discrepancy