Direct Materials and Direct Labor Variance Analysis

Best Faucet Company manufactures faucets in a small manufacturing facility. The faucets are made from zinc. Manufacturing has 50 employees. Each employee presently provides 35 hours of labor per week. Information about a production week is as follows:

Standard wage per hour	$17.4
Standard labor time per faucet	15 min.
Standard number of lbs. of zinc	2 lbs.
Standard price per lb. of zinc	$12.25
Actual price per lb. of zinc	$12.5
Actual lbs. of zinc used during the week	12,400 lbs.
Number of faucets produced during the week	6,000
Actual wage per hour	$17.9
Actual hours per week	1,750 hrs.

Required:

a. Determine the A detailed estimate of what a product should cost.standard cost per faucet for direct materials and direct labor. Round the cost per unit to two decimal places.

Direct materials standard cost per faucet	$
Direct labor standard cost per faucet	$
Total standard cost per faucet	$

b. Determine the direct materials Price variance is the difference between the actual and standard prices, multiplied by the actual quantity.price variance, direct materials The cost associated with the difference between the standard quantity and the actual quantity of direct materials used in producing a commodity.quantity variance, and total direct materials The difference between actual cost and the flexible budget at actual volumes.cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Price variance	$	Unfavorable < >FavorableUnfavorable
Quantity variance	$	Unfavorable < >FavorableUnfavorable
Total direct materials cost variance	$	Unfavorable < >FavorableUnfavorable

c. Determine the direct labor The cost associated with the difference between the standard rate and the actual rate paid for direct labor used in producing a commodity.rate variance, direct labor The cost associated with the difference between standard and actual hours of direct labor spent for producing a commodity.time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Rate variance	$	Unfavorable < >FavorableUnfavorable
Time variance	$	Unfavorable < >FavorableUnfavorable
Total direct labor cost variance	$	Unfavorable < >FavorableUnfavorable