Bryan Company employs a standard cost system in which direct materials inventory is carried at standard cost. Bryan has established the following standards for the prime costs of one unit of product: Standard Standard Standard Quantity Price Cost Direct Materials 6 kilograms $ 3.50/kilogram $21.00 Direct Labour 1.3 hours $11.00/hour $14.30 $35.30 During March, Bryan purchased 165,000 kilograms of direct materials at a total cost of $585,750. The total factory wages for March were $400,000, 90 percent of which were for direct labour. Bryan manufactured 25,000 units of product during March, using 151,000 kilograms of direct materials and 32,000 direct labour hours. A. What was the price variance for the direct materials acquired by the company during March? B. What was the direct materials quantity variance for March? C. What was the direct labour rate variance for March? and What was the direct labour efficiency variance for March?
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Bryan Company employs a standard cost system in which direct materials inventory is carried at standard cost. Bryan has established the following standards for the prime costs of one unit of product: Standard Standard Standard Quantity Price Cost Direct Materials 6 kilograms $ 3.50/kilogram $21.00 Direct Labour 1.3 hours $11.00/hour $14.30 $35.30 During March, Bryan purchased 165,000 kilograms of direct materials at a total cost of $585,750. The total factory wages for March were $400,000, 90 percent of which were for direct labour. Bryan manufactured 25,000 units of product during March, using 151,000 kilograms of direct materials and 32,000 direct labour hours.
A. What was the price variance for the direct materials acquired by the company during March?
B. What was the direct materials quantity variance for March?
C. What was the direct labour rate variance for March? and What was the direct labour efficiency variance for March?
Step by step
Solved in 2 steps
