Chapter 21 Quz Help Save &Exit; Submi oLroct materiale (15 1ba. $4 PRr SEo $60 1

Question

Chapter 21 Quz Help Save &Exit; Submi oLroct materiale (15 1ba. $4 PRr SEo $60 1b.) Direct labor (4 hrs.8 $14.00 per hr.) 56 During June the company incurred the following actual costs to produce 9,000 units Direct naterials (138,000 ibs.$3.80 per lb.) Direct labor (39,300 hrs. $14.20 per S58,060 hz.) Q Actual Quantity SQ Standard Quantity AP Actual Price SP Standard Price AH Actiual Hours SH Standard Hours AR Actual Rate SR Standard Rate (1) Compute the direct materials price and quantity variances (2) Compute the direct labor rate variance and the direct labor efficiency variance, Indicate whether each vanance is favorable or Complete this qaestion by entering your answers in the tabs below Required 1 Required 2 Compute tihe direct materials price and quantity variances and classify it as favorable or undavorable

Explanation / Answer

Solution 1:

Direct material price variance = $27,600 F

Direct material efficiency variance = $12,000 U

Direct material cost variance = $27,600 F + $12,000 U = $15,600 F

Solution 2:

Direct labor rate variance = $7,860 U

Direct labor efficiency variance = $46,200 U

Direct labor cost variance = $7,860 U + $46,200 U = $54,060 U

Direct Material Cost Variance Actual Cost Standard cost for actual quantity Standard Cost AQ * AP = AQ * SP = SQ * SP = 138000 $3.80 $524,400.00 138000 $4.00 $552,000.00 135000 $4.00 $540,000.00 $27,600 F $12,000 U Direct Material Price Variance Direct Material Qty variance

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