Diamond Company produces a single product. The company has set the following sta

Question

Diamond Company produces a single product. The company has set the following standards for materials and labor:

During the past month, the company purchased 11,000 pounds of direct materials at a cost of $30,250. All of this material was used in the production of 1,700 units of product. Direct labor cost totaled $69,550 for the month. The following variances have been computed:

Compute the standard price per pound of materials. (Round your intermediate calculations and final answer to 2 decimal places. Omit the "$" sign in your response.)

Compute the standard quantity allowed for materials for the month's production. (Round your intermediate calculations to 2 decimal places.)

Compute the standard quantity of materials allowed per unit of product. (Round your intermediate calculations to 2 decimal places.)

Compute the actual direct labor hours for the month.

Compute the labor rate variance. (Input the amount as a positive value. Leave no cells blank - be certain to enter "0" wherever required. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Round your intermediate calculations to 2 decimal places. Omit the "$" sign in your response.)

Standard quantity or
hours per unit Standard price
or rate   Direct materials ? pounds per unit    $? per pound        Direct labor 4.0 hours per unit    $10 per hour     

Explanation / Answer

1.

For direct materials:

a.

Compute the standard price per pound of materials. (Round your intermediate calculations and final answer to 2 decimal places. Omit the "$" sign in your response.)

  Standard price = $2.95

b.

Compute the standard quantity allowed for materials for the month's production. (Round your intermediate calculations to 2 decimal places.)

  Standard quantity = 10200 pounds

c.

Compute the standard quantity of materials allowed per unit of product. (Round your intermediate calculations to 2 decimal places.)

  Standard quantity = 6 pound per unit

2.

For direct labor:

a.

Compute the actual direct labor hours for the month.

  Actual direct labor hours  = 6500 hour

b.

Compute the labor rate variance. (Input the amount as a positive value. Leave no cells blank - be certain to enter "0" wherever required. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Round your intermediate calculations to 2 decimal places. Omit the "$" sign in your response.)

  Labor rate variance = $ 4550 U

1.

For direct materials:

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