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ACC - Costello Corporation




Question;Costello Corporation manufactures a single product. The standard cost per unit of product is shown below.Direct materials?2 pound plastic at $6.27 per pound $ 12.54Direct labor?0.50 hours at $11.00 per hour 5.50Variable manufacturing overhead 4.00Fixed manufacturing overhead 2.00Total standard cost per unit $24.04The predetermined manufacturing overhead rate is $12 per direct labor hour ($6.00 ? 0.50). It was computed from a master manufacturing overhead budget based on normal production of 2,500 direct labor hours (5,000 units) for the month. The master budget showed total variable costs of $20,000 ($8.00 per hour) and total fixed overhead costs of $10,000 ($4.00 per hour). Actual costs for October in producing 4,200 units were as follows.Direct materials (8,580 pounds) $ 55,770Direct labor (1,920 hours) 21,773Variable overhead 18,671Fixed overhead 8,659Total manufacturing costs $104,873The purchasing department buys the quantities of raw materials that are expected to be used in production each month. Raw materials inventories, therefore, can be ignored.(a) Compute all of the materials and labor variances. (Round answers to 0 decimal places, e.g. 125.)Total materials variance $Materials price variance $Materials quantity variance $Total labor variance $Labor price variance $Labor quantity variance $(b) Compute the total overhead variance.Total overhead variance $


Paper#39709 | Written in 18-Jul-2015

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