Sweetwater Company manufactures two products, Mountain Mist and Valley Stream. The company prepares its master budget on the basis of standard costs. The following data are for March. Mountain Mist Standards Direct materials Direct labor Valley Stream 3 ounces at $15 per ounce 5 hours at $60 per hour $48 $335,340 5,750 4 ounces at $16.50 per ounce 6 hours at $75 per hour $52.50 $397,800 7,800 Variable overhead (per direct labor-hour) Fixed overhead (per month) Expected activity (direct labor-hours) Actual results Direct material (purchased and used) Direct labor Variable overhead Fixed overhead Units produced (actual) 3,100 ounces at $13.50 per ounce 4,900 hours at $60.75 per hour $242,550 $313,950 1,000 units 4,700 ounces at $17.25 per ounce 7,400 hours at $76.50 per hour $378,510 $396,000 1,200 units

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Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.