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0/0.6 points
ABC Company makes a single product which has the following standards:
Direct materials 2 kilograms $4.30 per kilogram
Direct labor 3 hours $6.00 per hour
Variable overhead 3 hours $6.50 per hour
Fixed overhead 3 hours $9.00 per hour
The following data pertain to June's operations:
• Direct labor was $820,500 for 147,000 hours worked
Direct material purchases were 110,000 kilograms for $485,000
Variable manufacturing overhead incurred was $986,000
• Fixed manufacturing overhead incurred was $1,154,500
93,000 kilograms of direct materials were used
• The company sold 42,000 units at $130 each
• Variable manufacturing overhead is applied based on direct labor hours
46,000 units were produced during the year
Budgeted production was 45,000 units
• At the beginning of June there were no inventories.
The labor rate variance is:
Do not round intermediate calculations.
$54,000 U
X $61,500 U
$54,000 F
$61,500 F
