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Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct labor-hours and its standard cost card per unit is
Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct labor-hours and its standard cost card per unit is as follows: Direct material: 6 pounds at $8.00 per pound $ 48.00 Direct labor: 4 hours at $13 per hour 52.00 Variable overhead: 4 hours at $5 per hour 20.00 Total standard variable cost per unit $ 120.00 The company also established the following cost formulas for its selling expenses: Fixed Cost per Month Variable Cost per Unit Sold Advertising $ 380,000 Sales salaries and commissions $ 460,000 $ 30.00 Shipping expenses $ 21.00 The planning budget for March was based on producing and selling 20,000 units
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