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DuRoss Company produces coats. The company uses a standard costing system and has set the following standards for materials and labor: Fabric (8 yards @
DuRoss Company produces coats. The company uses a standard costing system and has set the following standards for materials and labor:
Fabric (8 yards @ $6) | $48 |
Direct labor (2 hours @ $18) | 36 |
Total prime cost | $84 |
During the year DuRoss produced 55,000 coats. Actual fabric purchased was 460,000 yards at $5.75 per yard. There were no beginning or ending inventories of fabric. Actual direct labor was 120,000 hours at $19.25 per hour.
Required: |
A. Compute the cost of leather and direct labor that should be incurred for the production of 55,000 coats. |
B. Compute the total budget variances for materials and labor. |
C. Compute the materials price variance. |
D. Compute the materials usage variance. |
E. Compute the labor rate variance. |
F. Compute the labor efficiency variance. |
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