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Direct Materials, Direct Labor, and Factory Overhead Cost Variance Analysis Mackinaw Inc. processes a base chemical into plastic. Standard costs and actual costs for direct
Direct Materials, Direct Labor, and Factory Overhead Cost Variance Analysis Mackinaw Inc. processes a base chemical into plastic. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of 7,600 units of product were as follows: Standard Costs Actual Costs Direct materials9,900 lb. at $5.20 Direct labor Factory overhead Rates per direct labor hr., 9,800 lb. at $5.10 1,900 hrs. at $17.80 1,940 hrs, at $18.10 based on 100% of normal capacity of 1,980 direct labor hrs. Variable cost, $4.70 $8,840 variable cost Fixed cost, $7.40 $14,652 fixed cost Each unit requires 0.25 hour of direct labor
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