Hemlock Nutritional Supplements (HNS) provides you with the following accounting records on manufacturing cost for the most recent month: Direct materials Direct labor Variable overhead $ 126,000 92,400 Production was 60,000 units (cases). Fixed manufacturing overhead was $144,000. same. 105,000 For the coming year, costs are expected to increase as follows: direct materials costs by 40 percent, excluding any effect of volume changes; direct labor by 22 percent; and fixed manufacturing overhead by 29.5 percent. Variable manufacturing overhead per unit is expected to remain the Required: Prepare a cost estimate for a volume level of 42,000 units of product in the upcoming month. Determine the costs per unit for the most recent month and for the upcoming month.

In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for …

The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on t…