Vitex, Inc. manufactures a popular consumer product and it has provided the following data excerpts from its standard cost system: Inputs(1) Standard Quantity or Hours(2)StandardPriceor RateStandardCost(1) × (2)Direct materials2.10pounds$16.60per pound$34.86Direct labor1.00hours$15.90per hour$15.90Variable manufacturing overhead1.00hours$9.10per hour$9.10Total standard cost per unit $59.86 TotalVariances Reported StandardCost*Priceor RateQuantity orEfficiencyDirect materials$627,480$11,542F$33,200UDirect labor$286,200$3,800U$15,900UVariable manufacturing overhead$163,800$4,800F$?†U *Applied to Work in Process during the period. The company's manufacturing overhead cost is applied to production on the basis of direct labor-hours. All of the materials purchased during the period were used in production. Work in process inventories are insignificant and can be ignored.4. How many actual direct labor-hours were worked during the period?5. What was the actual rate paid per direct labor-hour? (Round your answer to 2 decimal places.)

Standard costing means where standard is set for various cost element and actual cost is then…

Answered: Vitex, Inc. manufactures a popular…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter5: Process Costing

Section: Chapter Questions

Problem 2PB: The following product costs are available for Kellee Company on the production of eyeglass frames:...

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Vitex, Inc. manufactures a popular consumer product and it has provided the following data excerpts from its standard cost system:

Inputs	(1) Standard Quantity or Hours	(2) Standard Price or Rate	Standard Cost (1) × (2)
Direct materials	2.10	pounds	$	16.60	per pound	$	34.86
Direct labor	1.00	hours	$	15.90	per hour	$	15.90
Variable manufacturing overhead	1.00	hours	$	9.10	per hour	$	9.10
Total standard cost per unit						$	59.86

	Total	Variances Reported
	Standard Cost*	Price or Rate	Quantity or Efficiency
Direct materials	$	627,480	$	11,542	F	$	33,200	U
Direct labor	$	286,200	$	3,800	U	$	15,900	U
Variable manufacturing overhead	$	163,800	$	4,800	F	$	?^†	U

*Applied to Work in Process during the period.

The company's manufacturing overhead cost is applied to production on the basis of direct labor-hours. All of the materials purchased during the period were used in production. Work in process inventories are insignificant and can be ignored.

4. How many actual direct labor-hours were worked during the period?

5. What was the actual rate paid per direct labor-hour? (Round your answer to 2 decimal places.)

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

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