# Standard costing - not getting correct answer

Anil (1638 Points)

14 January 2011

Ardmore Enterprises uses a standard cost system in its small appliance division. The standard cost of manufacturing one unit of Zeb is as follows.

Materials – 60 pounds at \$1.50 per pond                                                      \$90

Labor – 3 hours at \$12 per hour                                                                      36

Factory overhead – 3 hours at \$ 8 per hour                                                   24

Total standard cost per unit                                                                              \$150

The budgeted variable factory overhead rate is \$3 per labor hour, and the budgeted fixed factory overhead is \$27,000 per month. During May, Ardmore produced 1,650 units of Zeb compared to a normal capacity of 1,800 units. The actual cost per unit was as follows.

Materials – 58 pounds at \$1.65 per pond                                                      \$95.7

Labor – 3.1 hours at \$12 per hour                                                                   37.2

Factory overhead – \$39930 per 1650 units                                                   24.20

Total standard cost per unit                                                                              \$157.10

What is flexible budget overhead variance for May ?

I am getting the answer 330 unfavourable arrived as under

Actual F. oh : 39930

Actual qty * std. rate = 1650*24 = 39600

Difference of above two = 330 unvavourable

Please anyone help me solve this problem to arrive at correct answer of 1920 favourable.