Misterio Company uses a standard costing system During the past
Misterio Company uses a standard costing system. During the past quarter, the following variances were computed:
Variable overhead efficiency variance........ $ 24,000 U
Direct labor efficiency variance.......... 120,000 U
Direct labor rate variance............ 10,400 U
Misterio applies variable overhead using a standard rate of $2 per direct labor hour allowed.
Two direct labor hours are allowed per unit produced. (Only one type of product is manufactured.) During the quarter, Misterio used 30 percent more direct labor hours than should have been used.
1. What were the actual direct labor hours worked? The total hours allowed?
2. What is the standard hourly rate for direct labor? The actual hourly rate?
3. How many actual units were produced?
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