Hurren Corporation makes a product with the following standard costs: Standard Quantity or Hours Direct materials 4.6 grams Direct labor 0.8 hours Variable 0.8 hours overhead Standard Price or Rate Standard Cost Per Unit $4.00 per gram $18.40 $11.00 per hour $8.80 $6.00 per hour $4.80 The company reported the following results concerning this product in June. Originally budgeted output 6,800 units Actual output 6,700 units Raw materials used in production 28,400 grams Actual direct labor-hours 4,700 hours Purchases of raw materials 32,000 grams Actual price of raw materials purchased $4.10 per gram Actual direct labor rate $11.90 per hour $5.70 per hour Actual variable overhead rate The company applies variable overhead on the basis of direct labor hours. The direct materials purchases variance is computed when the materials are purchased. The labor efficiency variance for June is: a. $7,854 F b. $7,260 U c. $7,260 F d. $7,854 U
Hurren Corporation makes a product with the following standard costs: Standard Quantity or Hours Direct materials 4.6 grams Direct labor 0.8 hours Variable 0.8 hours overhead Standard Price or Rate Standard Cost Per Unit $4.00 per gram $18.40 $11.00 per hour $8.80 $6.00 per hour $4.80 The company reported the following results concerning this product in June. Originally budgeted output 6,800 units Actual output 6,700 units Raw materials used in production 28,400 grams Actual direct labor-hours 4,700 hours Purchases of raw materials 32,000 grams Actual price of raw materials purchased $4.10 per gram Actual direct labor rate $11.90 per hour $5.70 per hour Actual variable overhead rate The company applies variable overhead on the basis of direct labor hours. The direct materials purchases variance is computed when the materials are purchased. The labor efficiency variance for June is: a. $7,854 F b. $7,260 U c. $7,260 F d. $7,854 U
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Hurren Corporation makes a product with the following standard costs:
Standard Quantity or
Hours
Direct materials
4.6 grams
Direct labor
0.8 hours
Variable
0.8 hours
overhead
Standard Price or
Rate
Standard Cost Per
Unit
$4.00 per gram
$18.40
$11.00 per hour
$8.80
$6.00 per hour
$4.80
The company reported the following results concerning this product in June.
Originally budgeted output
6,800 units
Actual output
6,700 units
Raw materials used in production
28,400 grams
Actual direct labor-hours
4,700 hours
Purchases of raw materials
32,000 grams
Actual price of raw materials purchased
$4.10 per gram
Actual direct labor rate
$11.90 per hour
$5.70 per hour
Actual variable overhead rate
The company applies variable overhead on the basis of direct labor hours. The direct
materials purchases variance is computed when the materials are purchased.
The labor efficiency variance for June is:
a. $7,854 F
b. $7,260 U
c. $7,260 F
d. $7,854 U
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