Oddo Corporation makes a product with the following standard costs:
| Standard Quantity or Hours |
Standard Price or Rate |
Standard Cost Per Unit |
| Direct materials |
2.0 ounces |
$6.00 per ounce |
$12.00 |
| Direct labor |
0.6 hours |
$12.00 per hour |
$7.20 |
| Variable overhead |
0.6 hours |
$4.50 per hour |
$2.70 |
The company reported the following results concerning this product in December.
| Originally budgeted output |
6,400 |
units |
| Actual output |
6,200 |
units |
| Raw materials used in production |
9,600 |
ounces |
| Actual direct labor-hours |
3,920 |
hours |
| Purchases of raw materials |
11,200 |
ounces |
| Actual price of raw materials |
5.75 |
per ounce |
| Actual direct labor rate |
11.20 |
per hour |
| Actual variable overhead rate |
4.20 |
per hour |
The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.