The Hayes Chemical Company produces a chemical used in dry cleaning. Its accounting system uses standard costs. The standards per 0.60-gallon can of chemical call for 1.30 gallons of material and 1.60 hours of labor. (1.30 gallons of material are needed to produce a 0.60-gallon can of product due to evaporation.) The standard cost per gallon of material is $7. The standard cost per hour for labor is $10. Overhead is applied at the rate of $7.25 per can. Expected production is 19,100 cans with fixed overhead per year of $23,875 and variable overhead of $6 per unit (a 0.60-gallon can). During 2021, 24,600 cans were produced; 32,000 gallons of material were purchased at a cost of $250,880; 27,500 gallons of material were used in production. The cost of direct labor incurred in 2021 was $332,264 based on an average actual wage rate of $8.73 per hour. Actual overhead for 2021 was $236,500. (a) ✓ Your answer is correct. Determine the standard cost per unit. (Round answer to 2 decimal places, e.g. 15.25.) Standard cost $ 32.35 per unit SUPPORT

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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The Hayes Chemical Company produces a chemical used in dry cleaning. Its accounting system uses
standard costs. The standards per 0.60-gallon can of chemical call for 1.30 gallons of material and 1.60
hours of labor. (1.30 gallons of material are needed to produce a 0.60-gallon can of product due to
evaporation.) The standard cost per gallon of material is $7. The standard cost per hour for labor is $10.
Overhead is applied at the rate of $7.25 per can. Expected production is 19,100 cans with fixed overhead
per year of $23,875 and variable overhead of $6 per unit (a 0.60-gallon can).
During 2021, 24,600 cans were produced; 32,000 gallons of material were purchased at a cost of
$250,880; 27,500 gallons of material were used in production. The cost of direct labor incurred in 2021
was $332,264 based on an average actual wage rate of $8.73 per hour. Actual overhead for 2021 was
$236,500.
(a)
Your answer is correct.
Determine the standard cost per unit. (Round answer to 2 decimal places, e.g. 15.25.)
Standard cost
!!
32.35
per unit
SUPPORT
Transcribed Image Text:The Hayes Chemical Company produces a chemical used in dry cleaning. Its accounting system uses standard costs. The standards per 0.60-gallon can of chemical call for 1.30 gallons of material and 1.60 hours of labor. (1.30 gallons of material are needed to produce a 0.60-gallon can of product due to evaporation.) The standard cost per gallon of material is $7. The standard cost per hour for labor is $10. Overhead is applied at the rate of $7.25 per can. Expected production is 19,100 cans with fixed overhead per year of $23,875 and variable overhead of $6 per unit (a 0.60-gallon can). During 2021, 24,600 cans were produced; 32,000 gallons of material were purchased at a cost of $250,880; 27,500 gallons of material were used in production. The cost of direct labor incurred in 2021 was $332,264 based on an average actual wage rate of $8.73 per hour. Actual overhead for 2021 was $236,500. (a) Your answer is correct. Determine the standard cost per unit. (Round answer to 2 decimal places, e.g. 15.25.) Standard cost !! 32.35 per unit SUPPORT
Calculate material, labor, and overhead variances. (Round intermediate calculations to 2 decimal places,
eg. 14.37 and final answers to O decimal places, e.g. 125. Enter all variances as a positive number.)
Material Price
Variance
Material Quantity
Variance
Labor Efficiency
Variance
Labor Rate Variance A $
Controllable
Overhead Variance
Overhead Volume
Variance
$
eTexthook and Media
$
$
$
26880
31360
48336
13000
193789
39875
Unfavorable
Favorable
Favorable
Favorable
Unfavorable
Favorable.
SUPPORT
Transcribed Image Text:Calculate material, labor, and overhead variances. (Round intermediate calculations to 2 decimal places, eg. 14.37 and final answers to O decimal places, e.g. 125. Enter all variances as a positive number.) Material Price Variance Material Quantity Variance Labor Efficiency Variance Labor Rate Variance A $ Controllable Overhead Variance Overhead Volume Variance $ eTexthook and Media $ $ $ 26880 31360 48336 13000 193789 39875 Unfavorable Favorable Favorable Favorable Unfavorable Favorable. SUPPORT
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