Deluxe Fender, which uses a standard cost system, manufactured 20,000 boat fenders during 2024, using 145,000 square feet of extruded vinyl purchased at $1.25 per square foot. Production required 410 direct labor hours that cost $16.50 per hour. The direct materials standard was seven square feet of vinyl per fender, at a standard cost of $1.30 per square foot. The labor standard was 0.022 direct labor hour per fender, at a standard cost of $15.50 per hour. Read the requirement. Begin with the cost variances. Select the required formulas, compute the cost variances for direct materials and direct labor, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations used: AC = actual cost; AQ = actual quantity; FOH = fixed overhead: SC = standard cost; SQ = standard quantity.) Direct materials cost variance Direct labor cost variance Formula Variance
Deluxe Fender, which uses a standard cost system, manufactured 20,000 boat fenders during 2024, using 145,000 square feet of extruded vinyl purchased at $1.25 per square foot. Production required 410 direct labor hours that cost $16.50 per hour. The direct materials standard was seven square feet of vinyl per fender, at a standard cost of $1.30 per square foot. The labor standard was 0.022 direct labor hour per fender, at a standard cost of $15.50 per hour. Read the requirement. Begin with the cost variances. Select the required formulas, compute the cost variances for direct materials and direct labor, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations used: AC = actual cost; AQ = actual quantity; FOH = fixed overhead: SC = standard cost; SQ = standard quantity.) Direct materials cost variance Direct labor cost variance Formula Variance
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Deluxe Fender, which uses a standard cost system, manufactured 20,000 boat fenders
during 2024, using 145,000 square feet of extruded vinyl purchased at $1.25 per square
foot. Production required 410 direct labor hours that cost $16.50 per hour. The direct
materials standard was seven square feet of vinyl per fender, at a standard cost of $1.30 per
square foot. The labor standard was 0.022 direct labor hour per fender, at a standard cost of
$15.50 per hour.
Read the requirement.
Begin with the cost variances. Select the required formulas, compute the cost variances for
direct materials and direct labor, and identify whether each variance is favorable (F) or
unfavorable (U). (Abbreviations used: AC = actual cost; AQ = actual quantity; FOH =
fixed overhead: SC = standard cost; SQ = standard quantity.)
Direct materials cost
variance
Direct labor cost variance
Formula
Variance
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