Exercise 10-6 (Algo) Direct Materials and Direct Labor Variances [LO10-1, LO10-2] Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor st.. unit of Zoom are given below: Standard Quantity or Hours 6.80 pounds 0.20 hours During the most recent month, the following activity was recorded: a. 15,100.00 pounds of material were purchased at a cost of $2.60 per pound. b. All of the material purchased was used to produce 2,000 units of Zoom. c. 300 hours of direct labor time were recorded at a total labor cost of $3,300. Required: Direct materials Direct labor Standard Price or Rate $ 2.90 per pound $ 9.00 per hour Standard Cost $ 19.72 $ 1.80 1. Compute the materials price and quantity variances for the month. 2. Compute the labor rate and efficiency variances for the month. Note: For all requirements, Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable for no effect (i.e., zero variance). Input all amounts as positive values. Round your intermediate calculations to th whole dollar.
Exercise 10-6 (Algo) Direct Materials and Direct Labor Variances [LO10-1, LO10-2] Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor st.. unit of Zoom are given below: Standard Quantity or Hours 6.80 pounds 0.20 hours During the most recent month, the following activity was recorded: a. 15,100.00 pounds of material were purchased at a cost of $2.60 per pound. b. All of the material purchased was used to produce 2,000 units of Zoom. c. 300 hours of direct labor time were recorded at a total labor cost of $3,300. Required: Direct materials Direct labor Standard Price or Rate $ 2.90 per pound $ 9.00 per hour Standard Cost $ 19.72 $ 1.80 1. Compute the materials price and quantity variances for the month. 2. Compute the labor rate and efficiency variances for the month. Note: For all requirements, Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable for no effect (i.e., zero variance). Input all amounts as positive values. Round your intermediate calculations to th whole dollar.
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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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![Exercise 10-6 (Algo) Direct Materials and Direct Labor Variances [LO10-1, LO10-2]
Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one
unit of Zoom are given below:
Direct materials
Direct labor
Standard Quantity
or Hours
6.80 pounds
0.20 hours
During the most recent month, the following activity was recorded:
a. 15,100.00 pounds of material were purchased at a cost of $2.60 per pound.
b. All of the material purchased was used to produce 2,000 units of Zoom.
c. 300 hours of direct labor time were recorded at a total labor cost of $3,300.
Required:
1. Materials price variance
1. Materials quantity variance
Standard Price or Rate
$ 2.90 per pound
$ 9.00 per hour
1. Compute the materials price and quantity variances for the month.
2. Compute the labor rate and efficiency variances for the month.
Note: For all requirements, Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None"
for no effect (i.e., zero variance). Input all amounts as positive values. Round your intermediate calculations to the nearest
whole dollar.
Answer is complete but not entirely correct.
$
$
2. Labor rate variance
2. Labor efficiency variance
$
$
4,530 F
4,350 U
600 U
(3,240) F
Standard
Cost
$ 19.72
$ 1.80](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd368279c-9e79-41b1-b6f0-c2d5c301fc3d%2F5de6503c-da99-4157-b0e1-8fd473fe1357%2F0i8ovel_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Exercise 10-6 (Algo) Direct Materials and Direct Labor Variances [LO10-1, LO10-2]
Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one
unit of Zoom are given below:
Direct materials
Direct labor
Standard Quantity
or Hours
6.80 pounds
0.20 hours
During the most recent month, the following activity was recorded:
a. 15,100.00 pounds of material were purchased at a cost of $2.60 per pound.
b. All of the material purchased was used to produce 2,000 units of Zoom.
c. 300 hours of direct labor time were recorded at a total labor cost of $3,300.
Required:
1. Materials price variance
1. Materials quantity variance
Standard Price or Rate
$ 2.90 per pound
$ 9.00 per hour
1. Compute the materials price and quantity variances for the month.
2. Compute the labor rate and efficiency variances for the month.
Note: For all requirements, Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None"
for no effect (i.e., zero variance). Input all amounts as positive values. Round your intermediate calculations to the nearest
whole dollar.
Answer is complete but not entirely correct.
$
$
2. Labor rate variance
2. Labor efficiency variance
$
$
4,530 F
4,350 U
600 U
(3,240) F
Standard
Cost
$ 19.72
$ 1.80
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