Kansas Company uses a standard cost accounting system. In 2017, the company produced 28,000 units. Each unit took several pounds of direct materials and 1.6 standard hours of direct labor at a standard hourly rate of $12.00. Normal capacity was 50,000 direct labor hours. During the year, 117,000 pounds of raw materials were purchased at $0.92 per pound. All materials purchased were used during the year.
If the labor price variance was $9,080 favorable, what was the actual rate per hour?
If total budgeted manufacturing overhead was $360,000 at normal capacity, what was the predetermined overhead rate?
(f) $7.20 per DLH
What was the standard cost per unit of product?
How much overhead was applied to production during the year?
Using one or more answers above, what were the total costs assigned to work in process?
Compute variances, prepare an income statement, and explain unfavorable variances.