Lenni Clothing Co. manufactures clothing in a small manufacturing facility. Manu
ID: 2449059 • Letter: L
Question
Lenni Clothing Co. manufactures clothing in a small manufacturing facility. Manufacturing has 25 employees. Each employee presently provides 40 hours of productive labor per week. Information about a production week is as follows: Standard wage per hr. ............. $ 12.00 Standard labor time per unit ............. 12 min. Standard number of yds. of fabric per unit ..... 5.0 yds. Standard price per yd. of fabric .......... $ 5.00 Actual price per yd. of fabric ........... $ 5.10 Actual yds. of fabric used during the week ......26,200 yds. Number of units produced during the week ..... 5,220 Actual wage per hr. .............. $ 11.80 Actual hrs. for the week ............ 1,000 hrs. Instructions Determine (a) The standard cost per unit for direct materials and direct labor; (b) The price variance, quantity variance, and total direct materials cost variance; (c) The rate variance, time variance, and total direct labor cost variance.
Explanation / Answer
a) Standard cost for direct material per unit = 5 * 5 =25per unit
Standard cost for direct labor per unit = 12 *12 /60 =$ 2.4 per unit
b)Price variance = AQ (AP-SP )
= 26200 (5.10 - 5 )
= 26200 *.10
= 2620 (U)
Quantity variance= SP (AQ -SQ)
= 5 ( 26200 - ( 5220 *5 )]
= 5 [ 26200 - 26100]
= 5 * 100
= 500 (U)
Total variance= 2620 +500 = $ 3120 (U)
c)Rate variance = AH (AR -SR)
= 1000 (11.80 - 12)
= 1000 *- .20
=- 200 (F)
Efficiency variance = SR [AH -SH]
= 12 [1000 - (5220 * 12/60)]
= 12 [1000 - 1044 ]
= 12 * -44
= - 528 (F)
Total variance = -200 (F) + -528(F)
= -728 (F)
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.