Water Control, Inc. manufactures water pumps and uses a standard cost system. The standard factory overhead costs per water pump are based on direct labor hours and are shown below. Variable overhead (4 hours at $8/hour) Fixed overhead (4 hours at $5/hour) Total overhead cost per unit $32 20 $52 *Based on a capacity of 100,000 direct labor hours per month. The following additional information is available for the month of November. • 22,000 pumps were produced although 25,000 had been scheduled for production. • 94,000 direct labor hours were worked at a total cost of $940,000. • The standard direct labor rate is $9 per hour. The standard direct labor time per unit is four hours. Variable overhead costs were $740,000. • Fixed overhead costs were $540,000.
Water Control, Inc. manufactures water pumps and uses a standard cost system. The standard factory overhead costs per water pump are based on direct labor hours and are shown below. Variable overhead (4 hours at $8/hour) Fixed overhead (4 hours at $5/hour) Total overhead cost per unit $32 20 $52 *Based on a capacity of 100,000 direct labor hours per month. The following additional information is available for the month of November. • 22,000 pumps were produced although 25,000 had been scheduled for production. • 94,000 direct labor hours were worked at a total cost of $940,000. • The standard direct labor rate is $9 per hour. The standard direct labor time per unit is four hours. Variable overhead costs were $740,000. • Fixed overhead costs were $540,000.
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter9: Standard Costing: A Functional-based Control Approach
Section: Chapter Questions
Problem 30P: Algers Company produces dry fertilizer. At the beginning of the year, Algers had the following...
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Transcribed Image Text:Water Control, Inc. manufactures water pumps and uses a standard cost system. The standard factory overhead
costs per water pump are based on direct labor hours and are shown below.
Variable overhead (4 hours at $8/hour)
Fixed overhead (4 hours at $5/hour)
Total overhead cost per unit
$32
20
$52
*Based on a capacity of 100,000 direct labor hours per month.
The following additional information is available for the month of November.
• 22,000 pumps were produced although 25,000 had been scheduled for production.
• 94,000 direct labor hours were worked at a total cost of $940,000.
• The standard direct labor rate is $9 per hour.
• The standard direct labor time per unit is four hours.
• Variable overhead costs were $740,000.
• Fixed overhead costs were $540,000.
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