t24 Milar Corporation makes a product with the following standard costs: ...
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Accounting
t24
Milar Corporation makes a product with the following standard costs:
Standard Quantity or Hours
Standard Price or Rate
Direct materials
6.0
pounds
$
5.50
per pound
Direct labor
0.8
hours
$
24.00
per hour
Variable overhead
0.8
hours
$
11.00
per hour
In January the company produced 3,350 units using 13,400 pounds of the direct material and 2,800 direct labor-hours. During the month, the company purchased 16,900 pounds of the direct material at a cost of $14,160. The actual direct labor cost was $66,796 and the actual variable overhead cost was $29,508.
The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.
The labor rate variance for January is:
Multiple Choice
$404 F
$404 U
$2,476 U
$2,476 F
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