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Carson Construction Consultants performs cement core tests in its Greenville laboratory. The following standard costs for the tests have been developed by the companys controller,
Carson Construction Consultants performs cement core tests in its Greenville laboratory. The following standard costs for the tests have been developed by the companys controller, Landon Carson, based on performing 2,100 core tests per month.
(h) Prepare a memo to Landon Carson providing possible explanations for the direct materials and direct labor variances.
Carson Construction Consultants performs cement core tests in its Greenville laboratory. The following standard costs for the tests have been developed by the company's controller, Landon Carson, based on performing 2,100 core tests per month. Standard Quantity Standard Cost Standard Price Direct materials Direct labor Variable overhead Fixed overhead Total standard cost per test S0.50 per pound $10 per DLH 9 per DLH S16 per DLH 4 pounds .5 DLH 5 DLH 5 DLH $2.00 5.00 4.50 8.00 19.50 At the end of March, London reported the following operatlonal results: The company actually performed 2,250 core tests during the month. ,500 pounds of direct materials were purchased during the month at a total cost of s5,600 6,300 pounds of direct materials were used to conduct the core tests. 850 direct labor hours were worked at a total cost of S9,775. Actual variable overhead was $7,800 Actual fixed overhead was S15,750. (h) Prepare a memo to Landon Carson providing possible explanatians for the direct materials and direct laor variancesStep by Step Solution
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