7-36 DIRECT MATERIALS AND MANUFACTURING LABOUR VARIANCES, SOLVING UNKNOWNS (CPA, adapted) On May 1, 2017, Bovar Company began the manufacture of a new paging machine known as Dandy. The company installed a standard costing system to account for manufacturing costs. The standard costs for a unit of Dandy follow: Direct material (3kg at $4 per kg) Direct manufacturing labour (1/2 hour at $20 per hour) Manufacturing overhead (75% of direct manufacturing labour costs) $12.00 10.00 7.50 $29.50 The following data were obtained from Bovar's records for the month of May: Debit Credit 125,000 55,000 Revenues Accounts payable control (for May's purchases of direct materials) Direct materials price variance Direct materials efficiency variance Direct manufacturing labour price variance Direct manufacturing labour efficiency variance 3,500 2,400 2,890 2,200 Actual production in May was 4,000 units of Dandy, and actual sales in May were 2,500 units. The amount shown for direct materials price variance applies to materials purchased during May. There was no beginning inventory of materials on May 1,2017. Compute each of the following items for Bovar for the month of May. Show your computations. Required 1 Standard direct manufacturing labour-hours allowed for actual output produced. 2 Actual direct manufacturing labour-hours worked 3 Actual direct manufacturing labour wage rate 4 Standard quantity of direct materials allowed (in kilograms) 5 Actual quantity of direct materials used in kilograms) 6 Actual quantity of direct materials purchased (in kilograms) 7 Actual direct materials price per kilogram