Plainfield Company manufactures Part G for use in its production cycle. The costs per unit for 10,000 units of Part G are as follows: Direct materials $ 3 Direct labor 15 Variable overhead 6 Fixed overhead Verona Company has offered to sell Plainfield 10,000 units of Part 0 for $30 per unit. If Plainfield accepts Verona's offer, the released facilities could be used to save $45,000 in relevant costs in the manufacture of Part II. In addition, $50,000 of the fixed overhead applied to Part G would be totally eliminated. What alternative is more desirable and by what amount is it more desirable? What budget is required before a 1)M Purchase Budget? The standard number of hours that should have been worked for the output attained is 8,000 direct labor hours and the actual number of direct labor hours worked was 8,400. If the direct labor price variance was $4,200 unfavorable, and the standard rate of pay was $9 per direct labor hour. What is the direct labour flexible budget variance?

Respuesta :

Answer: $35,000

Explanation:

To solve this question, the flexible budget will be compared to the actual costs, and the difference between them is shown in the form of the two variances. Labor rate variance focuses on wages paid for labor and it is defined as difference between the actual costs for direct labor and the budgeted costs that are based on the standards.

The calculation has been attached below.

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