Exercise 23-8 The following direct materials and direct labor data pertain to th
ID: 2596441 • Letter: E
Question
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 Actual materials price Standard labor rate Standard materials price $13 per hour $290 per ton $12.50 per hour $292 per ton Quantities Actual hours incurred and used Actual quantity of materials purchased and used Standard hours u Standard quantity of materials used 4,200 hours 1,000 tons 4,290 hours 990 tons sed Compute the total, price, and quantity variances for materials and labor. Total materials variance Materials price variance Materials quantity variance Total labor variance Unfavorable Neither favorable nor unfavorable Favorable Labor price variance Labor quantity varianceExplanation / Answer
Total materials variance = 1000*290 - 990*292 = 290000 - 289080 = 920 Unfavorable
Materials Price variance = (290 - 292)*1000 = 2000 favorable
Materials quantity variance = (1000 - 990)*292 = 2920 unfavorable
Total labor variance = 4200*13 - 4290*12.50 = 54600 - 53625 = 975 unfavorable
Labor price variance = (13 - 12.50)*4200 = 2100 unfavorable
Labor quantity variance = (4200 - 4290)*12.50 = 1125 favorable
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.