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 4,800 units of product were as follows Standard Costs Actual Costs 6,100 lb. at $5.70 Direct materials 6,200 lb. at $5.90 Direct labor Factory overhead Rates per direct labor hr., 1,200 hrs. at $16.40 1,230 hrs. at $16.60 based on 100% of normal capacity of 1,250 direct labor hrs.: Variable cost, $3.00 $3,560 variable cost Fixed cost, $4.70 $5,875 fixed cost Each unit requires 0.25 hour of direct labor