Gulf Coast Resins Company processes a base chemical into plastic. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of 2,600 units of product were as follows:

Each unit requires 0.6 hour of direct labor.

Instructions
Determine
(a) The price variance, quantity variance, and total direct materials cost variance;
(b) The rate variance, time variance, and total direct labor cost variance; and
(c) Variable factory overhead controllable variance, the fixed factory overhead volume variance, and total factory overhead costvariance.

Transcribed Image Text:

Standard Costs Actual Costs Direct materials Direct labor Factory overhead 6,850 pounds at $6.40 2,050 hours at $19.80 Rates per direct labor hour, based on 100% of normal capacity of 1,950 direct labor hours: 7,000 pounds at $6.35 2,100 hours at $20.20 Variable cost, $2.50 Fixed cost, $4.50 $4,970 variable cost $8,775 fixed cost