Manufacturing Cost Per Unit
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The following standard cost card is provided:
direct material (2lbs. @ $5.00 per lb.) $10.00
direct labor (1hr. @ $8.00 per hr.) $8.00
variable overhead (1hr. @ $3.00 per hr.) $3.00
fixed overhead (1hr. @ $2.00 per hr.) $2.00
Total overhead cost per unit $23.00
The fixed overhead rate is based on total budgeted fixed overhead of $12,000. During the period, the company produced and sold 5,800 units at the following costs.
direct material 12,000 pounds @ $4.50 per pound
direct labor 5, 750 hours @ $8.00 per hour
overhead $29,920
The standard manufacturing cost per unit is $23.00 while the actual manufacturing cost per unit was:
a)23.71
b)23.16
c)22.40
d) cannot be determined from the info provided
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The solution contains calculation of the actual manufacturing cost per unit.
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Hi,
Please see the response to your posting as below:
Actual direct material cost = 12000 pounds ...
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