Question

Cost standards for one unit of product no. C77: Direct material 3 pounds at $2.50 per pound $ 7.50 Direct labor 5 hours at $7.50 per hour 37.50 Actual results: Units produced 7,800 units Direct material purchased 26,000 pounds at $2.70 $ 70,200 Direct material used 23,100 pounds at $2.70 62,370 Direct labor 40,100 hours at $7.30 292,730 Use the information to compute the following variances. The standard hours allowed for the work performed are:

Answer 1

Answer:

Standard hours allowed= 39,000

Explanation:

Giving the following information:

Standard direct labor hours per unit= 5 hours

Actual results:

Units produced 7,800 units

To calculate the standard hours allowed, we need to multiply the number of units produced for the unitary standard direct labor hours:

Standard hours allowed= 7,800*5

Standard hours allowed= 39,000