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Dirickson Inc. has provided the following data concerning one of the products in its standard cost system. Variable manufacturing overhead is applied to products on
Dirickson Inc. has provided the following data concerning one of the products in its standard cost system. Variable manufacturing overhead is applied to products on the basis of direct labor-hours.
Inputs | Standard Quantity or Hours per Unit of Output | Standard Price or Rate | |||||||||
Direct materials | 7.6 | ounces | $ | 9.40 | per ounce | ||||||
Direct labor | 0.10 | hours | $ | 18.00 | per hour | ||||||
Variable manufacturing overhead | 0.10 | hours | $ | 5.30 | per hour | ||||||
The company has reported the following actual results for the product for July:
Actual output | 7,600 | units | |
Raw materials purchased | 63,000 | ounces | |
Actual cost of raw materials purchased | $ | 541,800 | |
Raw materials used in production | 57,750 | ounces | |
Actual direct labor-hours | 820 | hours | |
Actual direct labor cost | $ | 16,072 | |
Actual variable overhead cost | $ | 4,592 | |
The labor rate variance for the month is closest to:
Multiple Choice
a) $1,312 U
b) $1,216 U
c) $1,312 F
d) $1,216 F
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