CenterWare is a manufacturer of large flower pots for urban settings. The company has these standards: (Click the icon to view the standards.) (Click the icon to view the actual results.) Read the requirements. Requirement 1. Compute the direct labor rate variance and the direct labor efficiency variance. (Enter the variances as positive numbers. Enter the currency amounts in the formulas to the nearest cent, then round the final variance amounts to the nearest whole dollar. Label the variance as favorable (F) or unfavorable (U). Abbreviations used: DL = Direct labor) Begin with the direct labor rate variance. First determine the formula for the rate variance, then compute the rate variance for direct labor. x = DL rate variance avorable ( as OVE i Standard Price and Volume abd or. Direct materials (resin) 10 pounds per pot at a cost of $5.00 per pound 5.0 hours at a cost of $18.00 per hour Direct labor Standard variable manufacturing overhead rate Budgeted fixed manufacturing overhead Standard fixed MOH rate $6.00 per direct labor hour $46,000 $8.00 per direct labor hour (DLH) Print Done S. Actual Results D a el rs. Enter the vorable (F) al br. CenterWare allocated fixed manufacturing overhead to production based on standard direct labor hours. Last month, the company reported the following actual results for the production of 1,200 flower pots: Direct materials Purchased 13,060 pounds at a cost of $5.20 per pound; Used 12,360 pounds to produce 1,200 pots Direct labor Worked 5.5 hours per flower pot (6,600 total DLH) at a cost of $17.00 per hour Actual variable manufacturing overhead $6.40 per direct labor hour for total actual variable manufacturing overhead of $42.240 Actual fixed manufacturing overhead $45,500 Standard fixed manufacturing overhead allocated based on actual production $48,000 Print Done or enter any number in the input fields and then click Check Answer ate variance First determine the formula for the rate variance, then compute the rate variance for direc i Requirements X anc 1. Compute the direct labor rate variance and the direct labor efficiency variance. 2. What is the total variance for direct labor? 3. Who is generally responsible for each variance? 4. Interpret the variances. Print Done Requirement 1. Compute the direct labor rate variance and the direct labor efficiency variance. (Enter the variances as positive numbers. Enter the currency amounts in the formulas to the nearest cent, then round the final variance amounts to the nearest whole dollar. Label the variance as favorable (F) or unfavorable (U). Abbreviations used: DL = Direct labor) Begin with the direct labor rate variance. First determine the formula for the rate variance, then compute the rate variance for direct labor. Actual hours x Actual rate Standard rate ') = DL rate variance 2,500 xi ( $ 15.00 16.00 ) = $ 2,500 F Now compute the direct labor efficiency variance. First determine the formula for the efficiency variance, then compute the efficiency variance for direct labor. Standard rate x Actual hours Standard hours allowed") = DL efficiency variance 16.00 x 2,500 2,000 ') = $ 8,000 U Requirement 2. What is the total variance for direct labor? (Enter the amount as a positive number. Label the variance as favorable (F) or unfavorable (U).) The total variance for direct laboris $5,500 u
