Exercise 10-6 (Algo) Direct Materials and Direct Labor Variances [LO10-1, LO10-2] Huron Company produces a cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zo are given below: Standard Quantity or Hours 6.50 pounds 0.30 hours During the most recent month, the following activity was recorded: a. 20,500.00 pounds of material were purchased at a cost of $1.70 per pound. b. All of the material purchased was used to produce 3,000 units of Zoom. c. 800 hours of direct labor time were recorded at a total labor cost of $12,000. Direct materials Direct labor Standard Price or Rate $ 1.90 per pound $ 13.00 per hour Standard Cost $ 12.35 $ 3.90
Exercise 10-6 (Algo) Direct Materials and Direct Labor Variances [LO10-1, LO10-2] Huron Company produces a cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zo are given below: Standard Quantity or Hours 6.50 pounds 0.30 hours During the most recent month, the following activity was recorded: a. 20,500.00 pounds of material were purchased at a cost of $1.70 per pound. b. All of the material purchased was used to produce 3,000 units of Zoom. c. 800 hours of direct labor time were recorded at a total labor cost of $12,000. Direct materials Direct labor Standard Price or Rate $ 1.90 per pound $ 13.00 per hour Standard Cost $ 12.35 $ 3.90
Chapter1: Financial Statements And Business Decisions
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![Exercise 10-6 (Algo) Direct Materials and Direct Labor Variances [LO10-1, LO10-2]
Huron Company produces a 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
6.50 pounds
0.30 hours
During the most recent month, the following activity was recorded:
a. 20,500.00 pounds of material were purchased at a cost of $1.70 per pound.
b. All of the material purchased was used to produce 3,000 units of Zoom.
c. 800 hours of direct labor time were recorded at a total labor cost of $12,000.
Required:
Materials price variance
Materials quantity variance
Standard Price or Rate
$ 1.90 per pound
$ 13.00 per hour
Labor rate variance
Labor efficiency variance
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.
Standard Cost
$ 12.35
$ 3.90](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F41d33a1a-d163-42a6-91a6-f6d6b54686f0%2Fdcbfbe16-628d-4413-8346-3f5ea332cb14%2F3u1wycr_processed.png&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 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
6.50 pounds
0.30 hours
During the most recent month, the following activity was recorded:
a. 20,500.00 pounds of material were purchased at a cost of $1.70 per pound.
b. All of the material purchased was used to produce 3,000 units of Zoom.
c. 800 hours of direct labor time were recorded at a total labor cost of $12,000.
Required:
Materials price variance
Materials quantity variance
Standard Price or Rate
$ 1.90 per pound
$ 13.00 per hour
Labor rate variance
Labor efficiency variance
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.
Standard Cost
$ 12.35
$ 3.90
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