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. Standard Quantity or Standard Price or Rate Standard Cost Direct materials Direct labor Hours 7.40 pounds 0.45 hours $2.60 per pound $ 8.00 per hour $ 19.24 $ 3.60 During the most recent month, the following activity was recorded: a. Twelve thousand one hundred pounds of material were purchased at a cost of $2.50 per pound. b. All of the material purchased was used to produce 1.500 units of Zoom. c. 575 hours of direct labor time were recorded at a total labor cost of $5,750. Required: 1. Compute the materials price and quantity variances for the month. 2. Compute the labor rate and efficiency variances for the month. (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.)
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. Standard Quantity or Standard Price or Rate Standard Cost Direct materials Direct labor Hours 7.40 pounds 0.45 hours $2.60 per pound $ 8.00 per hour $ 19.24 $ 3.60 During the most recent month, the following activity was recorded: a. Twelve thousand one hundred pounds of material were purchased at a cost of $2.50 per pound. b. All of the material purchased was used to produce 1.500 units of Zoom. c. 575 hours of direct labor time were recorded at a total labor cost of $5,750. Required: 1. Compute the materials price and quantity variances for the month. 2. Compute the labor rate and efficiency variances for the month. (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.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text: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.
Standard
Quantity or
Standard Price or Rate Standard Cost
Direct materials
Direct labor
Hours
7.40 pounds
0.45 hours
$2.60 per pound
$ 8.00 per hour
$ 19.24
$ 3.60
During the most recent month, the following activity was recorded:
a. Twelve thousand one hundred pounds of material were purchased at a cost of $2.50 per pound.
b. All of the material purchased was used to produce 1.500 units of Zoom.
c. 575 hours of direct labor time were recorded at a total labor cost of $5,750.
Required:
1. Compute the materials price and quantity variances for the month.
2. Compute the labor rate and efficiency variances for the month.
(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.)
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