Exercise 23-8 Costs Quantities Open Show Work Exercise 23-8 The following direct
ID: 2560136 • Letter: E
Question
Exercise 23-8
Costs
Quantities
Open Show Work
Exercise 23-8
The following direct materials and direct labor data pertain to the operations of Laurel Company for the month of August.Costs
Actual labor rate $14 per hour Actual materials price $260 per ton Standard labor rate $13.50 per hour Standard materials price $262 per tonQuantities
Actual hours incurred and used 4,600 hours Actual quantity of materials purchased and used 1,800 tons Standard hours used 4,640 hours Standard quantity of materials used 1,780 tons(a)
Compute the total, price, and quantity variances for materials and labor.
Total materials variance $
FavorableNeither favorable nor unfavorableUnfavorable
Materials price variance $UnfavorableNeither favorable nor unfavorableFavorable
Materials quantity variance $FavorableNeither favorable nor unfavorableUnfavorable
Total labor variance $Neither favorable nor unfavorableFavorableUnfavorable
Labor price variance $Neither favorable nor unfavorableFavorableUnfavorable
Labor quantity variance $Neither favorable nor unfavorableFavorableUnfavorable
Click if you would like to Show Work for this question:Open Show Work
Explanation / Answer
Total Materials Variance = Actual Materials Price * Actual Quantity used - Standard Materials Price * Standard Quantity used
Total Materials Variance = $260 * 1,800 - $262 * 1,780
Total Materials Variance = $1,640 Unfavorable
Materials Price Variance = Actual Materials Price * Actual Quantity used - Standard Materials Price * Actual Quantity used
Materials Price Variance = $260 * 1,800 - $262 * 1,800
Materials Price Variance = $3,600 Favorable
Materials Quantity Variance = Standard Materials Price * Actual Quantity used - Standard Materials Price * Standard Quantity used
Materials Quantity Variance = $262 * 1,800 - $262 * 1,780
Materials Quantity Variance = $5,240 Unfavorable
Total Labor Variance = Actual Labor Rate * Actual Hours used - Standard Labor Rate * Standard Hours used
Total Labor Variance = $14 * 4,600 - $13.50 * 4,640
Total Labor Variance = $1,760 Unfavorable
Labor Rate Variance = Actual Labor Rate * Actual Hours used - Standard Labor Rate * Actual Hours used
Labor Rate Variance = $14 * 4,600 - $13.50 * 4,600
Labor Rate Variance = $2,300 Unfavorable
Labor Quantity Variance = Standard Labor Rate * Actual Hours used - Standard Labor Rate * Standard Hours used
Labor Quantity Variance = $13.50 * 4,600 - $13.50 * 4,640
Labor Quantity Variance = $540 Favorable
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.