Question

The following standard cost card is provided for Navid Company's Product A:

Direct material (2 lbs. @ $5.00 per lb.) $10.00
Direct labor (1 hr @ $8.00 per hr.) 8.00
Variable overhead (1 hr. @ $3.00 per hr.) 3.00
Fixed overhead (1 hr. @ $2.00 per hr.) 2.00
Total standard cost per unit $23.00

The fixed overhead rate is based on total budgeted fixed overhead of $12,000. During the period, the company produced and sold 5,800 units at the following costs:
Direct material 12,200 pounds @ $4.80 per pound
Direct labor 5,950 hours @ $8.00 per hour
Overhead $29,920
The standard manufacturing cost per unit is $23.00. What is the actual manufacturing cost per unit? (Do not round intermediate calculations.)

Cannot be determined from the information provided.

A. $17.96.
B. $23.46.
C. $36.16.

Answer 1

The actual manufacturing cost per unit is 23.46

Step-by-step explanation:

Step 1. Given information.

• Direct material $10.00
• Direct labor $8.00
• Variable overhead $3.00
• Fixed overhead $2.00
• Total standard cost per unit $23.00
• overhead 29.920

Step 2. Formulas needed to solve the exercise.

Actual manufacturing cost per unit

Direct materials = Fixed overhead * price direct material

Direct labor = direct labor * price per hour

cost per unit = Total cost / units sold

Step 3. Calculation.

(+) Direct materials = 12,200*4.80 = 58.560

(+) Direct labor = 5,950*8 = 47.600

(+) Overhead 29.920

Total 136.080

Cost per unit = 136,080/5,800

Cost per unit = 23.46

Step 4. Solution.

The actual manufacturing cost per unit is 23.46