Direct Materials, Direct Labor and Factory Overhead Cat Variance Analys Mackonaw Inc processes a base chemical into plastic. Standard costs and actual costs for direct materials, drect labor, and fectory overhead incurred for the manufacture of 78.000 units of product were as follows Standard Costs 226,200 a $4.90 19.500 hrs at $17.80 Rates per direct labor based on 100% of normal capacity of 20,350 dr Direct materias D Factory overhead Actual Costs 223.900 19,950 at $4.70 a $18.00 Variable cost, $3.30 Fixed cost $5.20 Each unit requires 025 hour of direct labor Required a. Determine the direct materials price varians, direct materies querdity venance, and total direct materials cost variance. Enter a favorabile variance as a negative number using a minus sign and an unfavorable variance as a positive number $63,710 vanable cost $105,820 fed cost Drect Material Price Variance Direct Materals Quantity Variance Tal Direct Materials Cost Variance b. Determine the direct laberrats variance, rect labor me seriams, and total direct labor cost venance, Enter a favorable varance as a negative number using a meus sign and an untevorable vanance as a puber Dired Laber Rate Variance Lavorable
Direct Materials, Direct Labor and Factory Overhead Cat Variance Analys Mackonaw Inc processes a base chemical into plastic. Standard costs and actual costs for direct materials, drect labor, and fectory overhead incurred for the manufacture of 78.000 units of product were as follows Standard Costs 226,200 a $4.90 19.500 hrs at $17.80 Rates per direct labor based on 100% of normal capacity of 20,350 dr Direct materias D Factory overhead Actual Costs 223.900 19,950 at $4.70 a $18.00 Variable cost, $3.30 Fixed cost $5.20 Each unit requires 025 hour of direct labor Required a. Determine the direct materials price varians, direct materies querdity venance, and total direct materials cost variance. Enter a favorabile variance as a negative number using a minus sign and an unfavorable variance as a positive number $63,710 vanable cost $105,820 fed cost Drect Material Price Variance Direct Materals Quantity Variance Tal Direct Materials Cost Variance b. Determine the direct laberrats variance, rect labor me seriams, and total direct labor cost venance, Enter a favorable varance as a negative number using a meus sign and an untevorable vanance as a puber Dired Laber Rate Variance Lavorable
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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Transcribed Image Text:Direct Materials, Direct Labor and Factory Overhead Cost Variance Analy
Mackinaw Inc processes a base chemical into plastic Standert costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of 78.000 units of product were as follows
Actual Costs
Standard Costs
226,200 bat $4.90
19.500 hrs $17.80
Rates per direct labor hr
223,900 ts at $4.70
19,950 hrs at $18.00
based on 100% of normal
capacity of 20,350 direct
labor hr
Variable cost, $3.30
Fixed cost, $5.20
Direct mater
Drector
Factory overhead
$63,710 variable cost
$105,820 feed cost
Required
a. Determine the direct materials price varianes, direct materies quantity variance, and total direct materials cost variance, Enter a favorable variance as a negative number using a minus sign and an unfavorable
variance as a positive number
Direct Material Price Variance
Direct Materials Quantity Variance
Total Direct Materials Cost Variance
UQ
Levorable ✓
b. Determine the direct laberrate variance, rect labore erance, and total direct labor cost vanance, Enter a favorable variance as a negative number veing a mus sign and an unfavorable variance as a
poi number
Dired Labor Rate Verence
favorable
Unfavorable
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