Question
Galla Corporation makes a product with the following standard costs: The company budgeted for production of 2,400 units in June, but actual production was 2,500
Galla Corporation makes a product with the following standard costs:
The company budgeted for production of 2,400 units in June, but actual production was 2,500 units. The company used 19,850 pounds of direct material and 980 direct labor-hours to produce this output. The company purchased 21,700 pounds of the direct material at $6.70 per pound. The actual direct labor rate was $19.20 per hour and the actual variable overhead rate was $1.80 per hour. The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. The materials quantity variance for June is:
$4,550 U
$4,355 F
$4,550 F
$4,355 U
Standard Quantity or Hours | Standard Price or Rate | Standard Cost Per Unit | |
Direct materials | 8.2 pounds | $7.00 per pound | $57.40 |
Direct labor | 0.4 hours | $20.00 per hour | $8.00 |
Variable overhead | 0.4 hours | $2.00 per hour | $0.80 |
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