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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 7.7
Tharaldson Corporation makes a product with the following standard costs:
Standard Quantity or Hours | Standard Price or Rate | Standard Cost Per Unit | |||
---|---|---|---|---|---|
Direct materials | 7.7 | ounces | $ 2.00 | per ounce | $ 15.40 |
Direct labor | 0.2 | hours | $ 11.00 | per hour | $ 2.20 |
Variable overhead | 0.2 | hours | $ 4.00 | per hour | $ .80 |
The company reported the following results concerning this product in June.
Originally budgeted output | 3,100 | units |
---|---|---|
Actual output | 2,500 | units |
Raw materials used in production | 20,500 | ounces |
Purchases of raw materials | 23,400 | ounces |
Actual direct labor-hours | 450 | hours |
Actual cost of raw materials purchases | $ 45,100 | |
Actual direct labor cost | $ 13,100 | |
Actual variable overhead cost | $ 3,550 |
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 efficiency variance for June is:
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