A company uses the following standard costs to produce a single unit of output D

Question

A company uses the following standard costs to produce a single unit of output Direct materlals Direct Labor Manufacturing overhead 0.5 hour at $3.80 per hour 6 pounds at $1.10 per pound 6.60 0.5 hour at $8.00 per hour$4.00 $1.90 During the latest month, the company purchased and used 58,000 pounds of direct materials at o price of $140 per pound to produce 10,000 units Direct labor costs for the month totaled $37,012 based on 4,870 direc fixed manufacturing overhead incurred was $16,000. Based on this information, the total direct materials cost variance for the month of output totaied $16,000 and t labor hours worked. Variable manufacturing overhead costs Incurred was Multsiple Choice 0 515,200 unfavorable $15.200 avorablo $17.400 favorable $17,400 untevorable

Explanation / Answer

Direct materials cost variance =(58000*1.4)-(10000*6.6)= 15200 Unfavorable Option 1 is correct

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