Lucia Company has set the following standard cost per unit for direct materials and direct labor. Direct materials (14 pounds @ $3 per pound) Direct labor (2 hours @ $14 per hour) $ 42 28 During May the company incurred the following actual costs to produce 8.100 units. Direct materials (115,788 pounds @ $2.80 per pound) Direct labor (19,700 hours @ $14.10 per hour) $ 323,968 277,770 AR = Actual Rate SR = Standard Rate AQ = Actual Quantity Standard Quantity SQ AP Actual Price SP=Standard Price AH = Actual Hours SH Standard Hours (1) Compute the direct materials price and quantity variances. (2) Compute the direct labor rate variance and the direct labor efficiency variance. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the direct materials price and quantity variances. Note: Indicate the effect of each variance by selecting favorable, unfavorable, or no variance.

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Lucia Company has set the following standard cost per unit for direct materials and direct labor.
Direct materials (14 pounds @ $3 per pound)
Direct labor (2 hours @ $14 per hour)
$ 42
28
During May the company incurred the following actual costs to produce 8.100 units.
Direct materials (115,780 pounds @ $2.80 per pound)
Direct labor (19,700 hours @ $14.10 per hour)
$ 323,968
277,770
AR = Actual Rate
SR = Standard Rate
AQ = Actual Quantity
SQ
AP
Standard Quantity
Actual Price
SP=Standard Price
AH = Actual Hours
SH Standard Hours
(1) Compute the direct materials price and quantity variances.
(2) Compute the direct labor rate variance and the direct labor efficiency variance.
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Compute the direct materials price and quantity variances.
Note: Indicate the effect of each variance by selecting favorable, unfavorable, or no variance.
Transcribed Image Text:Lucia Company has set the following standard cost per unit for direct materials and direct labor. Direct materials (14 pounds @ $3 per pound) Direct labor (2 hours @ $14 per hour) $ 42 28 During May the company incurred the following actual costs to produce 8.100 units. Direct materials (115,780 pounds @ $2.80 per pound) Direct labor (19,700 hours @ $14.10 per hour) $ 323,968 277,770 AR = Actual Rate SR = Standard Rate AQ = Actual Quantity SQ AP Standard Quantity Actual Price SP=Standard Price AH = Actual Hours SH Standard Hours (1) Compute the direct materials price and quantity variances. (2) Compute the direct labor rate variance and the direct labor efficiency variance. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the direct materials price and quantity variances. Note: Indicate the effect of each variance by selecting favorable, unfavorable, or no variance.
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