10-6

EXERCISE 10-6 Direct Materials and Direct Labor Variances L010-1, L010-2 Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below: Standard Cost Standard Quantity or Hours 4.6 pounds 0.2 hours Standard Price or Rate $2.50 per pound $18.00 per hour Direct materials ... Direct labor... $11.50 $3.60 During the most recent month, the following activity was recorded: a. Twenty thousand pounds of material were purchased at a cost of $2.35 per pound. b. All of the material purchased was used to produce 4,000 units of Zoom. c. 750 hours of direct labor time were recorded at a total labor cost of $14.925. Required: 1. Compute the materials price and quantity variances for the month. 2. Compute the labor rate and efficiency variances for the month. EXERCISE 10-7 Direct Materials Variances L010-1 Refer to the data in Exercise 10-6. Assume that instead of producing 4.000 units during the month