hapter 10 Homework Help Save & Eai Submi Check my 4 Exercise 10-8 Direct Meteria

Question

hapter 10 Homework Help Save & Eai Submi Check my 4 Exercise 10-8 Direct Meterials and Direct Labor Variances [L010-1, L010-2] Dawson Toys, Ltd produces a toy called the Maze. The company has recenitly established a standard cost system to help control costs and has estabilished the following standards for the Maze toy Drect materials 8 microns per toy at $0 30 per mikcrorn blook Direct labor 14 hours per toy at $710 per hour kns During July. the company prodced 5,200 Maze toys. The toys production data for the month are as follows Direct materials 75,000 microns were purchased at a cost of $0 29 per micron 23,000 of these microns were stll in inventory at the Direct labor 7,680 direct labor hours were worked at a cost of 559106 1. Compute the following variances for Aly (indicate the effect of eech variance by selecting ?, for tverable, "U" for unfavorable, and "None for no effect (e, zero variance). Input all amounts as positive velues. Do not round intermediate celculations. Round final answer to the nearest whole doliar amount a. The materials price and quantity variances b. The labor rate and efficiency variances here to search

Explanation / Answer

1 Actual rate 0.29 Per micron Direct material price variance = (Standard rate - Actual rate) * Actual quantity Direct material price variance = (.30-.29) * 52000 Direct material price variance = 520 Favorable 2 Standard Material for actual production 5200*8 41,600 Micron Direct material quantity variance=   ( Actual material - Standard material for acual production) *Standard rate Direct material quantity variance=   (52000 - 41600)* .30 2820 UnFavorable 3 Actual rate 7.70 per hour Labor rate variance = (Actual rate -Standard rate) * Actual hours Labor rate variance = (7.70 - 7.10) * 7680 4608 unFavorable 4 Standard labor hours for actual production 5200*1.4 7,280 Hours Labor Effeciency variance= (Actual hours - Standard hours for acual production) *Standard rate Labor Effeciency variance= (7680 - 7280)* 7.10 2840 UnFavorable

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