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1-Direct Labor Variances for a Service Company Mexicali On the Go Inc. owns and operates food trucks (mobile kitchens) throughout the west coast. The companys

1-Direct Labor Variances for a Service Company

Mexicali On the Go Inc. owns and operates food trucks (mobile kitchens) throughout the west coast. The companys employees have varying wage levels depending on their experience and length of time with the company. Employees work 8-hour shifts and are assigned to a truck each day based on labor needs to support the daily menu. One of its trucks, Donnas Mobile Fiesta offers a single menu item that changes daily. On May 6, the truck prepared 70 of its most popular item, the Breakfast Enchilada. The following data are available for that day:

Quantity of direct labor used 16 hrs.
(2 employees, working 8-hour shifts)
Actual rate for direct labor $15.40 per hr.
Standard direct labor per meal 0.2 hr.
Standard rate for direct labor $16.00 per hr.

a. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Round your answers to two decimal places.

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2-Direct Materials and Direct Labor Variances

At the beginning of June, Bezco Toy Company budgeted 5,000 toy action figures to be manufactured in June at standard direct materials and direct labor costs as follows:

Direct materials $50,000
Direct labor 36,000
Total $86,000

The standard materials price is $4.00 per pound. The standard direct labor rate is $18.00 per hour. At the end of June, the actual direct materials and direct labor costs were as follows:

Actual direct materials $49,600
Actual direct labor 34,020
Total $83,620

There were no direct materials price or direct labor rate variances for June. In addition, assume no changes in the direct materials inventory balances in June. Bezco Toy Company actually produced 4,850 units during June.

Determine the direct materials quantity and direct labor time variances. Round your per unit computations to two decimal places, if required. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

image text in transcribed

Direct Labor Variances for a Service Company Mexicali On the Go Inc. owns and operates food trucks (mobile kitchens) throughout the west coast. The company's employees have varying wage levels depending on their experience and length of time with the company. Employees work 8-hour shifts and are assigned to a truck each day based on labor needs to support the daily menu. One of its trucks, Donna's Mobile Fiesta offers a single menu item that changes daily. On May 6, the truck prepared 70 of its most popular item, the Breakfast Enchilada. The following data are available for that day: Quantity of direct labor used 16 hrs. (2 employees, working 8-hour shifts) Actual rate for direct labor $15.40 per hr. Standard direct labor per meal 0.2 hr. Standard rate for direct labor $16.00 per hr. a. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Round your answers to two decimal places. Direct Labor Rate Variance Favorable Direct Labor Time Variance Unfavorable Total Direct Labor Cost Variance $ Unfavorable Direct Materials and Direct Labor Variances At the beginning of June, Bezco Toy Company budgeted 5,000 toy action figures to be manufactured in June at standard direct materials and direct labor costs as follows: Direct materials $50,000 Direct labor 36,000 Total $86,000 The standard materials price is $4.00 per pound. The standard direct labor rate is $18.00 per hour. At the end of June, the actual direct materials and direct labor costs were as follows: Actual direct materials $49,600 Actual direct labor 34,020 Total $83,620 There were no direct materials price or direct labor rate variances for June. In addition, assume no changes in the direct materials inventory balances in June. Bezco Toy Company actually produced 4,850 units during June. Determine the direct materials quantity and direct labor time variances. Round your per unit computations to two decimal places, if required. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Direct materials quantity variance $ Unfavorable Direct labor time variance Favorable

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