Question
Sedona Company set the following standard costs for one unit of its product for 2015. Direct material (20 Ibs. @ $4.10 per Ib.) $ 82.00
Sedona Company set the following standard costs for one unit of its product for 2015. Direct material (20 Ibs. @ $4.10 per Ib.) $ 82.00 Direct labor (15 hrs. @ $6.00 per hr.) 90.00 Factory variable overhead (10 hrs. @ $3.60 per hr.) 36.00 Factory fixed overhead (10 hrs. @ $1.60 per hr.) 16.00 Standard cost $ 224.00 The $5.20 ($3.60 + $1.60) total overhead rate per direct labor hour is based on an expected operating level equal to 70% of the factory's capacity of 66,000 units per month. The following monthly flexible budget information is also available. Operating Levels (% of capacity) Flexible Budget 65% 70% 75% Budgeted output (units) 42,900 46,200 49,500 Budgeted labor (standard hours) 429,000 462,000 495,000 Budgeted overhead (dollars) Variable overhead $ 1,544,400 $ 1,663,200 $ 1,782,000 Fixed overhead 739,200 739,200 739,200 Total overhead $ 2,283,600 $ 2,402,400 $ 2,521,200 During the current month, the company operated at 65% of capacity, employees worked 410,000 hours, and the following actual overhead costs were incurred compute the predermined overhead application rate per hour for variable overhead,fixed overhead, and total overhead at 70 % of the capacity
Sedona Company set the following standard costs for one unit of its product for 2015. |
Direct material (20 Ibs. @ $4.10 per Ib.) | $ | 82.00 | ||
Direct labor (15 hrs. @ $6.00 per hr.) | 90.00 | |||
Factory variable overhead (10 hrs. @ $3.60 per hr.) | 36.00 | |||
Factory fixed overhead (10 hrs. @ $1.60 per hr.) | 16.00 | |||
Standard cost | $ | 224.00 | ||
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