Gilder Corporation makes a product with the following standard costs: Standard Q

Question

Gilder Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Standard Cost Per Unit Direct materials 5.6 grams $4.00 per gram $22.40 Direct labor 1.9 hours $19.00 per hour $36.10 Variable overhead 1.9 hours $4.00 per hour $7.60 The company reported the following results concerning this product in June. Originally budgeted output 5,400 units Actual output 5,300 units Raw materials used in production 28,500 grams Purchases of raw materials 33,000 grams Actual direct labor-hours 5,700 hours Actual cost of raw materials purchases $135,300 Actual direct labor cost $113,430 Actual variable overhead cost $21,090 The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. The materials quantity variance for June is: $4,720 U $4,838 F $4,720 F $4,838 U

Explanation / Answer

SQ*SR AQ*SR 5300*5.6*4 28500*4 118720 114000 Variance =118720-114000 4720 Favorable

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