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Kertman Corporation makes a product with the following standard costs: Direct materials Direct labor Variable overhead Standard Quantity or Hours 6.5 pounds 0.6 hours
Kertman Corporation makes a product with the following standard costs: Direct materials Direct labor Variable overhead Standard Quantity or Hours 6.5 pounds 0.6 hours 0.6 hours Standard Price or Rate $ 7.00 per pound Standard Cost Per Unit $ 45.50 $ 24.00 per hour $4.00 per hour $ 14.40 $2.40 In June the company's budgeted production was 3,400 units but the actual production was 3,500 units. The company used 22,150 pounds of the direct material and 2,290 direct labor-hours to produce this output. During the month, the company purchased 25,400 pounds of the direct material at a cost of $170,180. The actual direct labor cost was $57,021 and the actual variable overhead cost was $8,931 The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.
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