Premium Fender, which uses a standard cost system, manufactured 20,000 boat fenders during 2024, using 142,000 square feet of extruded vinyl K purchased at $1.35 per square foot. Production required 470 direct labor hours that cost $13.50 per hour. The direct materials standard was seven square feet of vinyl per fender, at a standard cost of $1.40 per square foot. The labor standard was 0.027 direct labor hour per fender, at a standard cost of $12.50 per hour. Read the requiremen Begin with the cost variances. Select the required formulas, compute the cost variances for direct materials and direct labor, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations used: AC = actual cost; AQ = actual quantity; FOH = fixed overhead; SC = standard cost; SQ = standard quantity.) Direct materials cost variance Direct labor cost variance Formula Variance
Premium Fender, which uses a standard cost system, manufactured 20,000 boat fenders during 2024, using 142,000 square feet of extruded vinyl K purchased at $1.35 per square foot. Production required 470 direct labor hours that cost $13.50 per hour. The direct materials standard was seven square feet of vinyl per fender, at a standard cost of $1.40 per square foot. The labor standard was 0.027 direct labor hour per fender, at a standard cost of $12.50 per hour. Read the requiremen Begin with the cost variances. Select the required formulas, compute the cost variances for direct materials and direct labor, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations used: AC = actual cost; AQ = actual quantity; FOH = fixed overhead; SC = standard cost; SQ = standard quantity.) Direct materials cost variance Direct labor cost variance Formula Variance
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Premium Fender, which uses a standard cost system, manufactured 20,000 boat fenders during 2024, using 142,000 square feet of extruded vinyl
K purchased at $1.35 per square foot. Production required 470 direct labor hours that cost $13.50 per hour. The direct materials standard was seven square
feet of vinyl per fender, at a standard cost of $1.40 per square foot. The labor standard was 0.027 direct labor hour per fender, at a standard cost of $12.50
per hour.
Read the requiremen
Begin with the cost variances. Select the required formulas, compute the cost variances for direct materials and direct labor, and identify whether each
variance is favorable (F) or unfavorable (U). (Abbreviations used: AC = actual cost; AQ = actual quantity; FOH = fixed overhead; SC = standard cost; SQ =
standard quantity.)
Direct materials cost variance
Direct labor cost variance
Formula
Variance
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