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Chrome File Edit View History Bookmarks People Window Help ??25% D ? Sun 7:01 PM a?E YOSEF ? ezto.mheducation.com/hm.tpx PA9-1 Calculating Direct Material, Direct Labor, Variable Overhead Variances LO 9-3, 9-4, 9-5] Barley Hopp, Inc., manufactures custom-ordered commemorative beer steins. Its standard cost information follows: Standard Standard Price Quantity 60 lbs.S 1.70 per lb. 1.60 hrs. S 16.00 per hr. Slandard Unit Cost S 2.72 25.60 1.92 (Rate) Direct materials (clay) Direct labor Variable manufacturing overhead (based on 1.60hrs. 1.20 per hr direct labor hours) Foed ma overhead (S364,500.00+ 2.70 135,000.00 units) Barley Hopp had the following actual results last year Number of units produced and scld Number of pounds of clay used Cost of clay Number of labor hours worked Direct labor cost Variable ovemead cos Fixed overhead cost 140,000 24B,200 $ 397,120 185,000 $3,626,000 270,000 S 380,000 Required: 1. Calculate the direct materials price, quantity, and total spending variances for Barley Hopp. (Do not round your intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable and "U" for unfavorable.) Direc: Materials Price Variance Direct Materials Quantity Variance Direct Materials Spending Variance 2. Calculate the direct labor rate, efficiency, and total spending variances for Barley Hopp. (Do not round your intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable and "U" for unfavorable.) Direct Labor Rate Variance Direct Labor Efficiancy Variance

Explanation / Answer

1) direct material price variance (Actua price - standard price)*aqpurchased (397,120 - 248200*1.70) 24,820 F direct material qty variance (AQ used - standard qty allowed)*standard rate (248200 - 140,000*1.6)*1.7 41140 U direct materials spending variance 16,320 U 2) direct labor rate variance (Actual price - standard rate )*ah (3,626,000    - 16*185000) 666000 U direct labor efficiency vriance (AH - SG)*standard rate (185000 - 140000*1.6)*16 624,000 F direct labor spending variance 42000 U 3) variable overhead rate (Actual price - standard rate )*ah (270,000 - 1.20*185000) 48000 U variable overhead efficiecny variance (AH - SG)*standard rate (185000 - 140,000*1.6)*1.2 46,800 F Variable overhead spending variance 1200 U

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