Huron Company produces a commercial cleaning compound known as Zoom. The direct
ID: 2446482 • Letter: H
Question
Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below:
Compute the materials price and quantity variances for the month. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)
Compute the labor rate and efficiency variances for the month. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Do not round your intermediate calculations.)
Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below:
Explanation / Answer
1. Material Variances
Output
3,000.00
Units
Standard Price (SP)
3.00
per pounds
Standard Qty (SQ)
6.80
Pounds per unit of output
Actual Qty (AQ)
7.63
Pounds per unit of output
Actual Price (AP)
2.70
per pounds
Material Usage Variance
(SP*SQ)- (SP*AQ)
Material Usage Variance
{3*(3000*6.80)}- (3*22900)
Material Usage Variance
(7,500.00)
Unfavorable (U)
Material Price Variance
(SP*AQ)- (AP*AQ)
Material Price Variance
(3*22900}- (2.70*22900)
Material Price Variance
6,870.00
Favorable (F)
Total Material Variance
(630.00)
Unfavorable (U)
1. Labour Variances
Output
3,000.00
Units
Standard Rate(SR)
11.00
per Hour
Standard Hour(SH)
0.50
Hours per unit
Actual Rate (AR)
13
per Hour
Actual Hour(AH)
0.47
Hours per unit
Material Usage Variance
(SR*SH)- (SR*AH)
Material Usage Variance
{11*(3000*0.5)}- (11*1400)
Material Usage Variance
1,100.00
Favorable (F)
Material Price Variance
(SR*AH)- (AR*AH)
Material Price Variance
(11*1400}- (13*1400)
Material Price Variance
(2,800.00)
Unfavorable (U)
Total Material Variance
(1,700.00)
Unfavorable (U)
1. Material Variances
Output
3,000.00
Units
Standard Price (SP)
3.00
per pounds
Standard Qty (SQ)
6.80
Pounds per unit of output
Actual Qty (AQ)
7.63
Pounds per unit of output
Actual Price (AP)
2.70
per pounds
Material Usage Variance
(SP*SQ)- (SP*AQ)
Material Usage Variance
{3*(3000*6.80)}- (3*22900)
Material Usage Variance
(7,500.00)
Unfavorable (U)
Material Price Variance
(SP*AQ)- (AP*AQ)
Material Price Variance
(3*22900}- (2.70*22900)
Material Price Variance
6,870.00
Favorable (F)
Total Material Variance
(630.00)
Unfavorable (U)
1. Labour Variances
Output
3,000.00
Units
Standard Rate(SR)
11.00
per Hour
Standard Hour(SH)
0.50
Hours per unit
Actual Rate (AR)
13
per Hour
Actual Hour(AH)
0.47
Hours per unit
Material Usage Variance
(SR*SH)- (SR*AH)
Material Usage Variance
{11*(3000*0.5)}- (11*1400)
Material Usage Variance
1,100.00
Favorable (F)
Material Price Variance
(SR*AH)- (AR*AH)
Material Price Variance
(11*1400}- (13*1400)
Material Price Variance
(2,800.00)
Unfavorable (U)
Total Material Variance
(1,700.00)
Unfavorable (U)
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