Calculate the following for April, 2010. The standard cost of manufacturing 1 RIX Standard cost of one unit Cost Direct materials 2kg at $ 3 per kg $6 Direct Labour 2hours at $ 15 per hour $30 Variable production overhead @t $1.50 per direct labor hour $3 fix production overhead 2 direct labor at $5.50 per direct labor hr $11.00 total standard cost of one Rix $50 Fix production overhead is base on the entities, normal level of production $20 000 Rix's per month. 18500 Rix's were made and actual ,manufacturing cost incurred were as follows. Direct materials 36800 at $2.90 per kg $106 720 Direct labor 40000 production hours at $14.20 per labor hour $ 56800 Variable production overhead $54900 Fix production $221100 Total manufacturing cost incurred $950720 A. Total production cost Calculate the following for April, 2010 A. Total production cost B. Direct materials cost, price and usage variance C. Direct cost rate, efficiency D. Variance production overhead spending and efficiency variance. E. Fix production overhead total variance, spending and volume.
[[B:[[B:It is a payroll cost of the production staff.It represents wages paid to the workers directly associated with production.direct labour is included in cost sheet in prime cost. Prime cost will only be calculated when we add Direct Material+ Direct Labour+ Direct Expenses. Direct labour is one of the important element of cost.]]
The cost of labor like assembly line labor which is used directly in the manufacturing of goods is called a direct labor cost. It is opposed to that cost which is used for support functions like maintenance. These costs appear on the income statement as a part of the cost of goods sold.
