A company produces a cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below: Standard Quantity or Hours Standard Price or Rate Standard Cost Direct materials 5.70 pounds $ 2.50 per pound $ 14.25 Direct labor 0.50 hours $ 7.50 per hour $ 3.75 During the most recent month, the following activity was recorded: Eleven thousand pounds of material were purchased at a cost of $2.40 per pound. The company produced only 1,100 units, using 9,900 pounds of material. (The rest of the material purchased remained in raw materials inventory.) 650 hours of direct labor time were recorded at a total labor cost of $7,800. Required: Compute the materials price and quantity variances for the month.
A company produces a cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below: Standard Quantity or Hours Standard Price or Rate Standard Cost Direct materials 5.70 pounds $ 2.50 per pound $ 14.25 Direct labor 0.50 hours $ 7.50 per hour $ 3.75 During the most recent month, the following activity was recorded: Eleven thousand pounds of material were purchased at a cost of $2.40 per pound. The company produced only 1,100 units, using 9,900 pounds of material. (The rest of the material purchased remained in raw materials inventory.) 650 hours of direct labor time were recorded at a total labor cost of $7,800. Required: Compute the materials price and quantity variances for the month.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
A company produces a cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below:
| Standard Quantity or Hours | Standard Price or Rate | ||||
|---|---|---|---|---|---|
| Direct materials | 5.70 | pounds | $ 2.50 | per pound | $ 14.25 |
| Direct labor | 0.50 | hours | $ 7.50 | per hour | $ 3.75 |
During the most recent month, the following activity was recorded:
- Eleven thousand pounds of material were purchased at a cost of $2.40 per pound.
- The company produced only 1,100 units, using 9,900 pounds of material. (The rest of the material purchased remained in raw materials inventory.)
- 650 hours of direct labor time were recorded at a total labor cost of $7,800.
Required:
Compute the materials price and quantity variances for the month.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education