Exercise 10-7 (Algo) Direct Materials Variances [LO10-1] 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 5.30 pounds 0.50 hours Standard Price or Rate $-2.50 per pound $5.50 per hour Materials price variance Materials quantity variance Standard Cost $ 13.25 $ 2.75 During the most recent month, the following activity was recorded: a. Ten thousand two hundred pounds of material were purchased at a cost of $2.40 per pound. b. The company produced only 1,020 units, using 9,180 pounds of material. (The rest of the material purchased remained in raw materials inventory.) c. 610 hours of direct labor time were recorded at a total labor cost of $7,320. Required: Compute the materials price and quantity variances for the month. (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. Do not round intermediate calculations.)

Exercise 10-7 (Algo) Direct Materials Variances [LO10-1] 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 5.30 pounds 0.50 hours Standard Price or Rate $-2.50 per pound $5.50 per hour Materials price variance Materials quantity variance Standard Cost $ 13.25 $ 2.75 During the most recent month, the following activity was recorded: a. Ten thousand two hundred pounds of material were purchased at a cost of $2.40 per pound. b. The company produced only 1,020 units, using 9,180 pounds of material. (The rest of the material purchased remained in raw materials inventory.) c. 610 hours of direct labor time were recorded at a total labor cost of $7,320. Required: Compute the materials price and quantity variances for the month. (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. Do not round intermediate calculations.)

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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