Direct Materials, Direct Labor, and Factory Overhead Cost Variance Analysis Mackinaw Inc. processes a base chemical into plastic. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of 5,200 units of product were as follows: Direct materials Direct labor Factory overhead Standard Costs 6,800 lb. at $5.20 1,300 hrs. at $17.80 Rates per direct labor hr., based on 100% of normal capacity of 1,360 direct labor hrs.: Variable cost, $3.20 Fixed cost, $5.10 Each unit requires 0.25 hour of direct labor. Required: Actual Costs 6,700 lb. at $5.00 1,330 hrs. at $18.10 $4,120 variable cost $6,936 fixed cost a. Determine the direct materials price variance, direct materials 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. Total direct labor cost variance Favorable Favorable Direct materials price variance Direct materials quantity variance Total direct materials cost variance b. 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 Direct labor time variance Favorable Unfavorable Unfavorable ✓ Unfavorable ✓ ✓ ✓ ✓

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Direct Materials, Direct Labor, and Factory Overhead Cost Variance Analysis
Mackinaw Inc. processes a base chemical into plastic. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of 5,200 units of product were as
follows:
Direct materials
Direct labor
Factory overhead
Standard Costs
6,800 lb. at $5.20
1,300 hrs. at $17.80
Rates per direct labor hr.,
based on 100% of normal
capacity of 1,360 direct
labor hrs.:
Variable cost, $3.20
Fixed cost, $5.10
Each unit requires 0.25 hour of direct labor.
Required:
Actual Costs
6,700 lb. at $5.00
1,330 hrs. at $18.10
a. Determine the direct materials price variance, direct materials 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 materials price variance
Direct materials quantity variance
Total direct materials cost variance
$
Total direct labor cost variance
$4,120 variable cost.
$6,936 fixed cost
Favorable
Favorable
Favorable
Unfavorable
Unfavorable
✓
b. 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
Direct labor time variance
Unfavorable
✓
✓
✓
Transcribed Image Text:Direct Materials, Direct Labor, and Factory Overhead Cost Variance Analysis Mackinaw Inc. processes a base chemical into plastic. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of 5,200 units of product were as follows: Direct materials Direct labor Factory overhead Standard Costs 6,800 lb. at $5.20 1,300 hrs. at $17.80 Rates per direct labor hr., based on 100% of normal capacity of 1,360 direct labor hrs.: Variable cost, $3.20 Fixed cost, $5.10 Each unit requires 0.25 hour of direct labor. Required: Actual Costs 6,700 lb. at $5.00 1,330 hrs. at $18.10 a. Determine the direct materials price variance, direct materials 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 materials price variance Direct materials quantity variance Total direct materials cost variance $ Total direct labor cost variance $4,120 variable cost. $6,936 fixed cost Favorable Favorable Favorable Unfavorable Unfavorable ✓ b. 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 Direct labor time variance Unfavorable ✓ ✓ ✓
c. Determine variable factory overhead controllable variance, the fixed factory overhead volume variance, and total factory overhead cost variance. Enter a favorable variance as a negative number using a
minus sign and an unfavorable variance as a positive number.
Variable factory overhead controllable variance
Fixed factory overhead volume variance
Total factory overhead cost variance
$
Favorable
Unfavorable
Unfavorable
Transcribed Image Text:c. Determine variable factory overhead controllable variance, the fixed factory overhead volume variance, and total factory overhead cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Variable factory overhead controllable variance Fixed factory overhead volume variance Total factory overhead cost variance $ Favorable Unfavorable Unfavorable
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