Question
During June, Danby Companys material purchases amounted to 8,400 pounds at a price of $7.60 per pound. Actual costs incurred in the production of 2,200
During June, Danby Companys material purchases amounted to 8,400 pounds at a price of $7.60 per pound. Actual costs incurred in the production of 2,200 units were as follows:
Direct labor: | $ | 139,650 | ($19.00 per hour) |
Direct material: | $ | 41,040 | ($7.60 per pound) |
The standards for one unit of Danby Companys product are as follows:
Direct Labor: | Direct Material: |
Quantity, 3 hours per unit | Quantity, 2 pounds per unit |
Rate, $18.90 per hour | Price, $7.30 per pound |
Required: Compute the direct-material price and quantity variances, the direct-material purchase price variance, and the direct-labor rate and efficiency variances. (Indicate the effect of each variance by selecting "Favorable" or "Unfavorable". Select "None" and enter "0" for no effect (i.e., zero variance).)
Direct-material price variance Direct-material quantity variance Direct-material purchase price variance Direct-labor rate variance Direct-labor efficiency varianceStep by Step Solution
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