Sierra produces walarmos Variable is applied based on direct labor hours. Sierra

Question

Sierra produces walarmos Variable is applied based on direct labor hours. Sierra expects production for the coming period to be 2960 units. At that level of activity, variable overhead is expected to be $17760. It should take 3 direct labor hours to produce 1 walarmo. Actual results are as follows: Number of walarmos produced: 3700 Actual direct labor hours: 13320 Actual variable overhead cost: $29304 Complete the following standard cost sheet: Direct materials Direct labor Variable Overhead Standard Unit Cost What would be in a flexible budget for materials cost? What would be in a flexible budget for labor cost? What would be in a flexible budget for variable overhead cost?

Explanation / Answer

Variable overhead rate (17760)/(2960*3) =2

Direct Material 8 gram 4 32 Direct Labor 3 hour 11 33 Variable Overhead 3 hour 2 6 Standared cost per unit 71

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