Calibri (Body At the beginning of the year, Shults Company had the following sta
ID: 2414456 • Letter: C
Question
Calibri (Body At the beginning of the year, Shults Company had the following standard cost sheet for one of its plastic products: Direct materials (5 kg @ $4.00) Direct labour (2 hrs. $11.25) Standard prime cost per unit The actual results for the year are as follows: a. Units produced: 175,000 b. Materials purchased: 930,000 kilograms @$4.10 c. Materials used: 925,000 kilograms d. Direct labour: 362,500 hours @ $11.15 The material price variance is $ The material usage variance is $ . This variance is (F/U) The total labour variance is $ The labour rate/price variance is $ The labour efficiency variance is $ . This variance is (F/U) s___ _ This variance is (F/U) . This variance is (F/U) s__ _. This variance is (F/U)Explanation / Answer
Material price variance = AQ purchased * (AP-SP) =930000*(4.10 - 4.00) = 93000 U
Material usage variance = SP * (AQ used-SQ)
=4.00*(925000-(175000*5)) = 200000 U
Total material variance = material price variance + material usage variance = 93000 U + 200000 U = 293000 U
Labor rate variance = AH *(AR - SR) =362500*(11.15-11.25) =-36250 =36250 F
Labor efficiency variance = SR*(AH - SH) = 11.25*(362500-(175000*2)) = 140625 U
Total labor variance = 36250 F + 140625 U = 104375 U
Therefore,
The material price variance is $93000. The Variance is U
The material usage variance is $200000. The variance is U
The total labor variance is $104375. The variance is U
The labor rate variance is $36250. The variance is F
The labor efficiency variance is $140625. The variance is U.
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.