Hi. Could you help me to solve this problem. Ayala Corporation accumulates the f

Question

Hi. Could you help me to solve this problem.

Ayala Corporation accumulates the following data relative to jobs started and finished during the month of June 2014. Overhead is applied on the basis of standard machine hours. 3.10 hours of machine time are required for each direct labor hour. The jobs were sold for $452,000. Selling and administrative expenses were $41,500. Assume that the amount of raw materials purchased equaled the amount used. Compute all of the variances for (1) direct materials and (2) direct labor.

Explanation / Answer

Particulars Standard Actual Qty Rate amount Qty Rate amount Materials              2,544.15                      4.19            10,660.00              2,627.91                      4.30            11,300.00 Labour            15,200.00               11.0500         167,960.00            14,900.00               11.6000         172,840.00 DMCV = Standard Cost - Actual Cost DMCV = 10,660 - 11,300 DMCV = 640 U DMPV = (SP-AP)*AQ DMPV = (4.19 - 4.30)2627.91 DMPV = 289.07 U DMQV= (SQ-AQ)SP DMQV= (2544.15 - 2627.91)4.19 DMQV= 350.93 U DLCV = Standard costs - Actual Costs DLCV = 167,960 - 172,840 DLCV = 4,880 U DLRV= (SR-AR)AH DLRV= (11.05 - 11.60)14,900 DLRV= 8,195 U DLEV = (SH-AH)SR DLEV = (15,200 - 14,900)11.05 DLEV = 3,315 F

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