Question
Canandaigua containter company manufactures recyclable soft drink cans. A unit of production is a case of 12 dozen canss. The following standards have been set
Canandaigua containter company manufactures recyclable soft drink cans. A unit of production is a case of 12 dozen canss. The following standards have been set by the pdocution-engineering staff and the controller.
Direct Labor: Direct Material:
Quantity, .25 hr Quantity, 4 kilograms
Rate, $12 per hr Price, $.60 per kilogram
Actual material purchases amounted to 240,000 kilograms at $.62 per kilogram. Actual cost incurred in the production of 50,000 units were as follows:
Direct Labor: $158,600 for 13,000 hours
Direct Material: $130,200 for 210,000 kilograms
1. use the variance formulas to compute the direct labor rate and efficiency variance - indicate if variance is favorable or unfavorable
2. construct a excel spreadsheet to solve the preceding requirement. Show how the solution will change if the following information changes: the standard direct labor rate is $14 per hour, and the standard direct material price is $.59 per kilogram. *** need to know the labor variances only
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