direct material in units 97,000 direct labor hourse 30,000 machine hours 26,000 number of set ups 300 number of devices produced 16,000 The 210,000 units of material had a total cost of 1,365,000. Direct labor is 17 per hour. The company has total overhead production cost of 1,850,000 Cost Pool 1. Equipment Maintenance 2. Production Set up 3. Material Handling 4. Transportation Cost Cost driver 1. # of machine hours 2. # of set ups 3. units of materials 4. # of devices produced Cost 1. 585,000 2. 125,000 3. 540,000 4. 600,000 Volume 1. 39,000 2. 900 3. 210,000 4. 24,000 Compute the unit cost.
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
direct material in units 97,000
direct labor hourse 30,000
machine hours 26,000
number of set ups 300
number of devices produced 16,000
The 210,000 units of material had a total cost of 1,365,000. Direct labor is 17 per hour.
The company has total
Cost Pool
1. Equipment Maintenance
2. Production Set up
3. Material Handling
4. Transportation Cost
Cost driver
1. # of machine hours
2. # of set ups
3. units of materials
4. # of devices produced
Cost
1. 585,000
2. 125,000
3. 540,000
4. 600,000
Volume
1. 39,000
2. 900
3. 210,000
4. 24,000
Compute the unit cost.
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