Direct Materials and Direct Labor Variance Analysis Abbeville Company manufactures faucets in a small manufacturing facility. The faucets are made from brass. Manufacturing has 90 employees. Each employee presently provides 36 hours of labor per week. Information about a production week is as follows: Standard wage per hr. $15.00 Standard labor time per faucet 40 min. Standard number of Ib. of brass 3 Ib. Standard price per ib. of brass $2.40 Actual price per Ib. of brass $2.50 Actual Ib. of brass used during the week 14,350 Ib. Number of faucets produced during the week 4,800 Actual wage per hr. $14.40 Actual hrs. for the week 3,240 hrs. Required: a. Determine the standard cost per unit for direct materials and direct labor. Round the cost per unit to two decimal places. Direct materials standard cost per unit 7.2 Direct labor standard cost per unit 10 Total standard cost per unit 17.20 b. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Round your answers to two decimal places, if necessary. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Direct materials price variance 1,435 Unfavorable Direct materials quantity variance Favorable Total direct materials cost variance 1,315 Unfavorable c. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Direct labor rate variance Favorable Direct labor time variance 600 Unfavorable Total direct labor cost variance Favorable
Direct Materials and Direct Labor Variance Analysis Abbeville Company manufactures faucets in a small manufacturing facility. The faucets are made from brass. Manufacturing has 90 employees. Each employee presently provides 36 hours of labor per week. Information about a production week is as follows: Standard wage per hr. $15.00 Standard labor time per faucet 40 min. Standard number of Ib. of brass 3 Ib. Standard price per ib. of brass $2.40 Actual price per Ib. of brass $2.50 Actual Ib. of brass used during the week 14,350 Ib. Number of faucets produced during the week 4,800 Actual wage per hr. $14.40 Actual hrs. for the week 3,240 hrs. Required: a. Determine the standard cost per unit for direct materials and direct labor. Round the cost per unit to two decimal places. Direct materials standard cost per unit 7.2 Direct labor standard cost per unit 10 Total standard cost per unit 17.20 b. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Round your answers to two decimal places, if necessary. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Direct materials price variance 1,435 Unfavorable Direct materials quantity variance Favorable Total direct materials cost variance 1,315 Unfavorable c. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Direct labor rate variance Favorable Direct labor time variance 600 Unfavorable Total direct labor cost variance Favorable
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
.
Transcribed Image Text:Direct Materials and Direct Labor Variance Analysis
Abbeville Company manufactures faucets in a small manufacturing facility. The faucets are made from brass. Manufacturing has 90 employees. Each employee presently provides 36 hours of labor per week. Information about a production week is as follows:
Standard wage per hr.
$15.00
Standard labor time per faucet
40 min.
Standard number of Ib. of brass
3 lb.
Standard price per Ib. of brass
$2.40
Actual price per Ib. of brass
$2.50
Actual Ib. of brass used during the week
14,350 Ib.
Number of faucets produced during the week
4,800
Actual wage per hr.
$14.40
Actual hrs. for the week
3,240 hrs.
Required:
a. Determine the standard cost per unit for direct materials and direct labor. Round the cost per unit to two decimal places.
Direct materials standard cost per unit
7.2
Direct labor standard cost per unit
10
Total standard cost per unit
17.20
b. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Round your answers to two decimal places, if necessary. Enter a favorable variance as a negative number using a minus sign and an
unfavorable variance as a positive number.
Direct materials price variance
1,435
Unfavorable
Direct materials quantity variance
Favorable
Total direct materials cost variance
1,315
Unfavorable
c. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.
Direct labor rate variance
$
Favorable
Direct labor time variance
600
Unfavorable
Total direct labor cost variance
Favorable
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
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.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