BatCo makes metal baseball bats. Each bat requires 1 kg of aluminum at $20 per kg and 0.35 direct labor hours at $22 per hour. Overhead is assigned at the rate of $32 per direct labor hour. Assume the actual cost to manufacture one metal hat was $44.90. Compute the cost variance and classify it as favorable or unfavorable.

Principles of Accounting Volume 2
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Chapter8: Standard Costs And Variances
Section: Chapter Questions
Problem 5PA: Ed Co. manufactures two types of O rings, large and small. Both rings use the same material but...
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BatCo makes metal baseball bats. Each bat requires 1 kg of aluminum at
$20 per kg and 0.35 direct labor hours at $22 per hour. Overhead is
assigned at the rate of $32 per direct labor hour. Assume the actual cost to
manufacture one metal hat was $44.90.
Compute the cost variance and classify it as favorable or unfavorable.
Transcribed Image Text:BatCo makes metal baseball bats. Each bat requires 1 kg of aluminum at $20 per kg and 0.35 direct labor hours at $22 per hour. Overhead is assigned at the rate of $32 per direct labor hour. Assume the actual cost to manufacture one metal hat was $44.90. Compute the cost variance and classify it as favorable or unfavorable.
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