IV. Comprehensive Variance Analysis

Flushing Corp. produces a single product. Variable manufacturing overhead is applied to products on the basis of direct labor hours. The standard cost card for one unit of product is as follows:

(1) (2)

Standard Standard Standard

Quantity Price Cost

Inputs or Hours or Rate (1) x (2)

Direct Materials 6 oz. $0.50 per oz. $3.00

Direct Labor 0.6 hours $30.00 per hour 18.00

Variable Manufacturing Overhead 0.6 hours $10.00 per hour 6.00

Total Standard Cost Per Unit $27.00

During June, 2000 units were produced. The costs associated with Junes operations were as

follows:

Materials purchased: 18,000 oz. at $0.60 per oz$10,800

Materials used in production 18,000 oz. ...

Direct Labor: 1,100 hours at $30.50 per hour....$33,500

Variable Manufacturing overhead costs incurred...$12,980

Required:

Compute the direct materials, direct labor, and variable manufacturing overhead variances.