Exercise 10-4 Direct Labor and Variable Manufacturing Overhead Variances LC10-2, LO10-3] Erie Company manufactures a small mp3 player called the Jogging Mate. The company uses standards to control its costs. The labor standards that have been set for one Jogging Mate mp3 player are as follows: Standard Standard Rate Standard Hours per Hour Cost $2.48 24 minutes $6.20 During August, 8,380 hours of direct labor time were needed to make 19,200 units of the Jogging Mate. The direct labor cost totaled $50,280 for the month. Required: 1. According to the standards, what direct labor cost should have been incurred to make 19,200 units of the Jogging Mate? By how much does this differ from the cost that was incurred? (Round Standard labor time per unit to 2 decimal places 19,200 Number of units manufactured Standard labor time per unit 0.40 Total standard hours of labor time 7,680 allowed Standard direct labor rate per hour 6.20 Total standard direct labor cost 47,616 Actual direct labor cost 50,280 47,616 Standard direct labor cost 5 2,664 Total variance unfavorable