Knope Incorporated invented a new canvas duffle bag called the Dufflemaster. Kno

Question

Knope Incorporated invented a new canvas duffle bag called the Dufflemaster. Knope has a standard cost system and following are the standards for the Dufflemaster bag:

Direct labor: 7,740 direct labor-hours were worked at a cost of $58,050.

Compute the following variances for July. (Do not round your per unit rates, round other intermediate calculations and your final answer to nearest whole dollar. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).):

Direct materials: 6 yards of canvas per duffle bag at $0.34 per yard Direct labor: 1.4 hours per duffle bag at $6.90 per hour

Explanation / Answer

a) Direct material price variance = (0.34-0.31)*75000 = 2250 F

Direct material quantity variance = (5100*6-38250)0.34 = 2601 U

b) Direct labour rate variance = (6.90*7740-58050) = 4644 U

Direct labour efficiency variance = (5100*1.40-7740)*6.9 = 4140 U

Related Questions

Navigate

• Browse (All)
• Browse K
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.