Damico Inc. is a privately held furniture manufacturer For August 2017 Damico had the following standards for one of its products, a wicker chair (Click the icon to view the standards per chair) The following data were compiled regarding actual performance actual output units (chairs) produced, 3,000 square yards of input purchased and used, 8,600 price per square yard $5 70 direct manufacturing labor costs, 89,894, actual hours of input, 970; labor price per hour. 510.20 Read the requirements X X Requirement 1. Show computations of price and efficiency variances for direct materials and direct manufacturing labor Glve a plausible explanation of why each variance occurred. Let's begin by determining the formula used to calculate the actual costs of direct materials then enter the amounts in the formula and calculate the cost Actual price Actual Input Actual cost Direct materials 5.70 8600 49,020 Next we will calculate the actual input at the budgeted price Actual input Budgeted price Cost Direct materials 8.600 5.60 48.160 970 Direct manufacturing labor 9,700 10.00 Determine the formula and calculate the costs for the flexible budget Rawatan innafnrarialet Runotonina Choose from any list or enter any number in the input fields and then continue to the next question x Direct manufacturing labor MU TURU 9,700 Determine the formula and calculate the costs for the flexible budget X X Budgeted input for actual output Budgeted price Flexible budget cost Direct materials 5.60 Direct manufacturing labor X 10.00 Now compute the price and efficiency variances for direct materials and direct manufacturing labor Label each variance as favorab unfavorable (U) Price Efficiency variances variances Direct materials 860 U F Direct manufacturing labor 194 F F Now aive a plausible explanation of why each variance occurred Begin with the direct material variances list the input fields and then to the next Damico, Inc. is a privately held furniture manufacturer For August 2017 Damico had the following standards for one of its products, a wicker chair (Click the icon to view the standards per chair) The following data were compiled regarding actual performance actual output units (chairs) produced, 3,000 square yards of input purchased and used, 8,600 price per square yard. $5.70, direct manufacturing labor costs $9,894, actual hours of input. 970, labor price per hour $10.20 Read the requirements Requirement 2. Suppose 11.100 square yards of materials were purchased (at $5.70 per square yard), even though only 8,600 square yards were used. Suppose further that variances are identified at their most timely control point, accordingly, direct materials price variances are isolated and traced at the time of purchase to the purchasing department rather than to the production department Compute the price and efficiency variances under this approach Begin with recalculating the costs using the information provided for the alternative approach Actual input X Actual cost Budgeted price Flexible budget cost Purchasing Production Now compute the direct materials price and efficiency variances Label each variance as favorable (F) or unfavorable (U). Price Efficiency varianna varianne Damico, Inc. is a privately held furniture manufacturer For August 2017 Damico had the following standards for one of its products, a wicker chair (Click the icon to view the standards per chair) The following data were compiled regarding actual performance actual output units (chairs) produced, 3,000 square yards of Input purchased and used. 8,600 price per square yard, $5.70, direct manufacturing labor costs $9,894 actual hours of input 970, labor price per hour, $10.20 Read the requirements traced at the time of purchase to the purchasing department rather than to the production department Compute the price and officiency variances under this approach Begin with recalculating the costs using the information provided for the alternative approach Actual input Actual cost Budgeted price Flexible budget cost Purchasing Production Now compute the direct materials price and efficiency variances Label each variance as favorable (F) or unfavorable (U). Price Efficiency variance variance U F Direct materials i Data Table ws - X Direct materials Standards per Chair 3 square yards of input at $ 5.60 per square yard 0.5 hour of input at $ 10.00 per hour Direct manufacturing labor Print Done i hequirements 1. Show computations of price and efficiency variances for direct materials and direct manufacturing labor. Give a plausible explanation of why each variance occurred. 2. Suppose 11,100 square yards of materials were purchased (at $5.70 per square yard), even though only 8,600 square yards were used. Suppose further that variances are identified at their most timely control point; accordingly, direct materials price variances are isolated and traced at the time of purchase to the purchasing department rather than to the production department. Compute the price and efficiency variances under this approach. Print Done