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Lily Corporation manufactures a single product. The standard cost per unit of product is shown below. Direct materials-1 pound plastic at $7.00 per pound
Lily Corporation manufactures a single product. The standard cost per unit of product is shown below. Direct materials-1 pound plastic at $7.00 per pound $7.00 Direct labor-1.6 hours at $12.00 per hour 19.20 12.00 Variable manufacturing overhead Fixed manufacturing overhead Total standard cost per unit 4.00 $42.20 The predetermined manufacturing overhead rate is $10 per direct labor hour ($16 1.6). It was computed from a master manufacturing overhead budget based on normal production of 8,800 direct labor hours (5,500 units) for the month. The master budget showed total variable costs of $66,000 ($7.50 per hour) and total fixed overhead costs of $22,000 ($2.50 per hour). Actual costs for October in producing 5,340 units were as follows. Direct materials (5,580 pounds) $40,734 Direct labor (8,170 hours) 102,942 Variable overhead 65,760 Fixed overhead 22,800 Total manufacturing costs $232,236
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