Question
Beach Boys Company makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Direct materials 5.2 grams $ 7.00
Beach Boys Company makes a product with the following standard costs: |
Standard Quantity or Hours | Standard Price or Rate | ||||
Direct materials | 5.2 | grams | $ | 7.00 | per gram |
Direct labor | 0.5 | hours | $ | 14.00 | per hour |
Variable overhead | 0.5 | hours | $ | 4.00 | per hour |
In June the company produced 4,500 units using 24,650 grams of the direct material and 2,610 direct labor-hours. During the month the company purchased 24,400 grams of the direct material at a price of $6.80 per gram. The actual direct labor rate was $14.60 per hour and the actual variable overhead rate was $3.90 per hour. The materials price variance is computed when materials are purchased. Variable overhead is applied on the basis of direct labor-hours. |
Required: | ||||||||||||||||||||||||
Compute the following variances for raw materials, direct labor, and variable overhead, assuming that the price variance for materials is recognized at point of purchase: (Input all amounts as positive values. Do not round intermediate calculations. Leave no cells blank - be certain to enter "0" wherever required. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.)
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