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Direct-material price variance Direct-material quantity variance Direct-material purchase price variance

Direct-material price variance Direct-material quantity variance Direct-material purchase price variance

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Please explain the calculations!!

The left blank column is for a number, the right blank column is to label it favorable, unfavorable, or none.

During June, Danby Company's material purchases amounted to 7,300 pounds at a price of $7.80 per pound. Actual costs incurred in the production of 2,000 units were as follows: Direct labor: $113,750 ($18.20 per hour) Direct material: $36,660 ($7.80 per pound) The standards for one unit of Danby Company's product are as follows: Direct Labor: Quantity, 3 hours per unit Rate, $18.10 per hour Direct Material: Quantity, 2 pounds per unit Price, $7.50 per pound Required: Compute the direct-material price and quantity variances, the direct-material purchase price variance, and the direct-labor rate and efficiency variances. (Indicate the effect of each variance by selecting "Favorable" or "Unfavorable". Select "None" and enter "0" for no effect (i.e., zero variance).) Direct-material price variance Direct-material quantity variance Direct-material purchase price variance Direct-labor rate variance Direct-labor efficiency variance Favorable Unfavorable None
Transcribed Image Text:During June, Danby Company's material purchases amounted to 7,300 pounds at a price of $7.80 per pound. Actual costs incurred in the production of 2,000 units were as follows: Direct labor: $113,750 ($18.20 per hour) Direct material: $36,660 ($7.80 per pound) The standards for one unit of Danby Company's product are as follows: Direct Labor: Quantity, 3 hours per unit Rate, $18.10 per hour Direct Material: Quantity, 2 pounds per unit Price, $7.50 per pound Required: Compute the direct-material price and quantity variances, the direct-material purchase price variance, and the direct-labor rate and efficiency variances. (Indicate the effect of each variance by selecting "Favorable" or "Unfavorable". Select "None" and enter "0" for no effect (i.e., zero variance).) Direct-material price variance Direct-material quantity variance Direct-material purchase price variance Direct-labor rate variance Direct-labor efficiency variance Favorable Unfavorable None
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