Misterio Company uses a standard costing system. During the past quarter, the following variances were computed: Variable overhead efficiency variance $ 32,760 U Direct labor efficiency variance 98,280 U Direct labor rate variance. 16,380 U Misterio applies variable overhead using a standard rate of $3 per direct labor hour allowed. Three direct labor hours are allowed per unit produced. (Only one type of product is manufactured.) During the quarter, Misterio used 20 percent direct labor hours than should have been used. Required: 1. What were the actual direct labor hours worked? X hours. What are the total hours allowed? hours 2. What is the standard hourly rate for direct labor? per hour What is the actual hourly rate? Round your answer to the nearest cent. $ per hour 3. How many actual units were produced? units

Misterio Company uses a standard costing system. During the past quarter, the following variances were computed: Variable overhead efficiency variance $ 32,760 U Direct labor efficiency variance 98,280 U Direct labor rate variance. 16,380 U Misterio applies variable overhead using a standard rate of $3 per direct labor hour allowed. Three direct labor hours are allowed per unit produced. (Only one type of product is manufactured.) During the quarter, Misterio used 20 percent direct labor hours than should have been used. Required: 1. What were the actual direct labor hours worked? X hours. What are the total hours allowed? hours 2. What is the standard hourly rate for direct labor? per hour What is the actual hourly rate? Round your answer to the nearest cent. $ per hour 3. How many actual units were produced? units

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Description: Misterio Company uses a standard costing system. During the past quarter, the following variances were computed:Variable overhead efficiency varianceDirect labor efficiency varianceDirect labor rate varianceRequired:1. What were the actual direct la

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

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Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Concept explainers

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.

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Question

Misterio Company uses a standard costing system. During the past quarter, the following variances were computed:
Variable overhead efficiency variance
Direct labor efficiency variance
Direct labor rate variance
Required:
1. What were the actual direct labor hours worked?
X hours
Misterio applies variable overhead using a standard rate of $3 per direct labor hour allowed. Three direct labor hours are allowed per unit produced. (Only one type of product is manufactured.) During the quarter, Misterio used 20 percent more
direct labor hours than should have been used.
What are the total hours allowed?
hours
2. What is the standard hourly rate for direct labor?
per hour
$ 32,760 U
98,280 U
3. How many actual units were produced?
units
16,380 U
What is the actual hourly rate? Round your answer to the nearest cent.
$
per hour

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