The following are standard costs related to a product of Jacobs, SRL: Inputs: Unit of Input Units per item Price or rate Direct Materials: square feet 80 $22/square foot Direct Labor: direct labor hours 24 $38/direct labor hour Variable Overhead: direct labor hours $49/direct labor hour The company applies variable overhead on the basis of direct labor hours. In April, the following results were reported: Actual output: 506 items Raw Materials used: 45,684 square feet Raw Material purchased: 42,335 square feet Actual direct labor hours: 14,168 hours Actual cost of raw materials purchased: $973,705 Actual direct labor cost: $609,224 Actual variable overhead cost: $665,896 The direct material purchases variance is computed when the materials are purchased. Determine each of the following variances and whether they are favorable or unfavorable: Part 1: Direct Material quantity variance: 114,488 Unfavorable 114,488 Favorable 83,145 Favorable 83, 145 Unfavorable Part 2: Direct Labor rate variance: 70,840 unfavorable 70,840 favorable 87,032 favorable 87,032 unfavorable Part 3: Direct Material price variance: BLANK favorable or unfavorable Part 4: Direct Labor efficiency variance: BLANK favorable or unfavorable

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Concept explainers

Question

The following are standard costs related to a product of Jacobs, SRL:

Inputs:	Unit of Input	Units per item	Price or rate
Direct Materials:	square feet	80	$22/square foot
Direct Labor:	direct labor hours	24	$38/direct labor hour
Variable Overhead:	direct labor hours		$49/direct labor hour

The company applies variable overhead on the basis of direct labor hours.

In April, the following results were reported:

Actual output:	506 items
Raw Materials used:	45,684 square feet
Raw Material purchased:	42,335 square feet
Actual direct labor hours:	14,168 hours
Actual cost of raw materials purchased:	$973,705
Actual direct labor cost:	$609,224
Actual variable overhead cost:	$665,896

The direct material purchases variance is computed when the materials are purchased. Determine each of the following variances and whether they are favorable or unfavorable:

Part 1: Direct Material quantity variance:

114,488 Unfavorable

114,488 Favorable

83,145 Favorable

83, 145 Unfavorable

Part 2: Direct Labor rate variance:

70,840 unfavorable

70,840 favorable

87,032 favorable

87,032 unfavorable

Part 3: Direct Material price variance: BLANK favorable or unfavorable

Part 4: Direct Labor efficiency variance: BLANK favorable or unfavorable

Expert Solution

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions