The West Point plan of Walkers Electronics Company has the following standards for component C91: Standards: Material 2 units of material B Material Price $10 per unit of B Direct labor 1 hour Wage rate $10 per direct labour hour Variable support cost rate $25 per direct labour hour Actual results for March Used 4,200 units of B, purchased at $9.75 per unit of B Paid for 2,000 direct labour hours at $11 per hour Incurred $48,000 of variable support costs Manufactured 2,000 units of component C91 Required: Determine any (5) five of following variances for March: Total direct material cost variance Total direct labour cost variance Total variable support cost variance
Course: Accounting for Decision Making and Control
The West Point plan of Walkers Electronics Company has the following standards for component C91:
Standards:
Material 2 units of material B
Material Price $10 per unit of B
Direct labor 1 hour
Wage rate $10 per direct labour hour
Variable support cost rate $25 per direct labour hour
Actual results for March
Used 4,200 units of B, purchased at $9.75 per unit of B
Paid for 2,000 direct labour hours at $11 per hour
Incurred $48,000 of variable support costs
Manufactured 2,000 units of component C91
Required:
Determine any (5) five of following variances for March:
- Total direct material cost variance
- Total direct labour cost variance
- Total variable support cost variance
- Direct material price variance
- Direct material quality variance
- Direct labour rate variance
Direct labour efficiency variance
* As per Bartleby policy, if multiple subparts are there then answer first three subparts only.
1. Direct material cost variance = Actual material cost - standard material cost
Actual material cost = 4200*9.75= $ 40950
Standard material cost= (2000*2)*10= $ 40000
Direct material cost variance = $40950- $40000
= $ 950 Adverse
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