Answered step by step
Verified Expert Solution
Question
00
1 Approved Answer
Great Guard, which used a standard cost accounting system, manufactured 230,000 boat fenders during the year, using 1,890,000 feet of extruded vinyl purchased at $1.15
Great Guard, which used a standard cost accounting system, manufactured 230,000 boat fenders during the year, using 1,890,000 feet of extruded vinyl purchased at $1.15 per foot. Production required 4,800 direct labor hours that cost $14.00 per hour. The materials standard was 8 feet of vinyl per fender at a standard cost of $1.25 per foot. The labor standard was 0.022 direct labor hour per fender at a standard cost of $13.00 per hour. Read the requirements Requirement 1. Compute the price and quantity variances for direct materials. Compute the rate and efficiency variances for direct labor. (Enter the variances as positive numbers. Enter currency amounts to the nearest cent and your answers to the nearest whole dollar Label the variances as favorable (F) or unfavorable (U). Abbreviations used: DM = Direct materials, DL - Direct labor.) Begin with the variances for direct materials. First, determine the formula for the direct materials price variance, then compute the price variance for direct materials (Assume that the quantity of materials purchased is equal to the quantity of materials used.) DM price variance a P ) = ) XL * Requirements Compute the price and quantity variances for direct materials. Compute the rate and efficiency variances for direct labor. Does the pattern of variances suggest that the company's managers have been making trade-offs? Explain. Print Done
![image text in transcribed](https://s3.amazonaws.com/si.experts.images/answers/2024/09/66dcb27d36866_64466dcb27c8d23a.jpg)
![image text in transcribed](https://s3.amazonaws.com/si.experts.images/answers/2024/09/66dcb27e2a722_64566dcb27d74e09.jpg)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-text-image.webp)
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Step: 3
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started