**LIME Corporation Standard Cost Analysis**LIME Corporation developed standard costs for direct materials and direct labor. In 2020, LIME estimated the following standard costs for one of their most loved products, the LIME classic Mother’s Pear Pie, which featured a brown sugar coating on top.| Budgeted Quantity | Budgeted Price ||--------------------|----------------------|| Direct materials | 2.0 pounds | $6.25 per pound || Direct labor | 0.20 hours | $13.00 per hour |**September Production Analysis:**- LIME produced and sold 1,100 pies.- They used 2,300 pounds of direct materials at an average cost of $6.00 per pound.- They utilized 200 direct labor hours at an average wage of $13.25 per hour.**Task: Calculate the Direct Labor Price Variance for September****Options:**- $260.00 unfavorable- $280.00 favorable- $50.00 unfavorable- $50.00 favorable---### Detailed ExplanationTo determine the direct labor price variance:1. **Calculate Actual Labor Cost**: - Actual hours worked = 200 hours - Actual hourly wage = $13.25 - Total actual labor cost = 200 hours × $13.25/hour = $2,6502. **Calculate Standard Labor Cost**: - Standard hourly wage = $13.00 - Total standard labor cost for actual hours = 200 hours × $13.00/hour = $2,6003. **Calculate Direct Labor Price Variance**: - Labor price variance = Actual labor cost - Standard labor cost - Variance = $2,650 - $2,600 = $50.00 unfavorableThus, the direct labor price variance during September is **$50.00 unfavorable**.

Name: **LIME Corporation Standard Cost Analysis**LIME Corporation developed
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Description: **LIME Corporation Standard Cost Analysis**LIME Corporation developed standard costs for direct materials and direct labor. In 2020, LIME estimated the following standard costs for one of their most loved products, the LIME classic Mother’s Pear Pie

Direct Labor Price Variance is Difference Between Standard cost of Actual Production and Actual Cost…

Business

Accounting

LIME Corporation developed standard costs for direct material and direct labor. In 2020, LIME estimated the following standard costs for one of their most well loved products, the LIME classic Mother's Pear Pie which had a brown sugar coating on top. Budgeted quantity Budgeted price Direct materials 2.0 pounds $6.25 per pound Direct labor 0.20 hours $13.00 per hour During September, LIME produced and sold 1,100 pies using 2,300 pounds of direct materials at an average cost per pound of $6.00 and 200 direct labor hours at an average wage of $13.25 per hour. The direct labor price variance during September is $260.00 unfavorable O $280.00 favorable O $50.00 unfavorable $50.00 favorable

LIME Corporation developed standard costs for direct material and direct labor. In 2020, LIME estimated the following standard costs for one of their most well loved products, the LIME classic Mother's Pear Pie which had a brown sugar coating on top. Budgeted quantity Budgeted price Direct materials 2.0 pounds $6.25 per pound Direct labor 0.20 hours $13.00 per hour During September, LIME produced and sold 1,100 pies using 2,300 pounds of direct materials at an average cost per pound of $6.00 and 200 direct labor hours at an average wage of $13.25 per hour. The direct labor price variance during September is $260.00 unfavorable O $280.00 favorable O $50.00 unfavorable $50.00 favorable

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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