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Tharaldson Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Standard Cost Per Unit Direct materials 7.0
Tharaldson Corporation makes a product with the following standard costs:
Standard Quantity or Hours | Standard Price or Rate | Standard Cost Per Unit | |||
---|---|---|---|---|---|
Direct materials | 7.0 | ounces | $ 3.00 | per ounce | $ 21.00 |
Direct labor | 0.3 | hours | $ 14.00 | per hour | $ 4.20 |
Variable overhead | 0.3 | hours | $ 9.00 | per hour | $ 2.70 |
The company reported the following results concerning this product in June.
Originally budgeted output | 2,400 | units |
---|---|---|
Actual output | 2,900 | units |
Raw materials used in production | 22,000 | ounces |
Purchases of raw materials | 23,100 | ounces |
Actual direct labor-hours | 550 | hours |
Actual cost of raw materials purchases | $ 45,000 | |
Actual direct labor cost | $ 12,400 | |
Actual variable overhead cost | $ 3,200 |
The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.
The labor rate variance for June is:
Multiple Choice
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$177 F
-
$4,700 F
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$177 U
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$4,700 U
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