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Chapter 8 - Group Problem

# Chapter 8 - Group Problem - Jogging Mate By how much does...

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Name of Group: __________________ Chapter 8 – Practice Problem Erie Company manufactures a small CD player called Jogging Mate. The company uses standards to control it costs. The labor standards that have been set for one Jogging Mate CD player are as follows: Standard Hours Standard Rate Per Hour Standard Cost 18 minutes \$ 12.00 \$ 3.60 During August, 5750 hours of direct labor time were needed to make 20,000 units of the Jogging Mate. The direct labor cost totaled \$73,600 for the month. Required: What direct labor cost should have been incurred to make 20,000 units of the
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Unformatted text preview: Jogging Mate? By how much does this differ from the cost that was incurred? Break down the difference in cost from (1) above into a labor rate variance and a labor efficiency variance. The budgeted variable manufacturing overhead rate is \$4 per direct labor-hour. During August, the company incurred \$21,850 in variable manufacturing overhead cost. Compute the variable overhead spending and efficiency variances for the month....
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