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Hasak Corp makes 100 kg containers of vegetable seeds, and has the following unit standard costs for direct materials and direct labour: Direct materials (90
Hasak Corp makes 100 kg containers of vegetable seeds, and has the following unit standard costs for direct materials and direct labour: Direct materials (90 kg @$8.00 per kg) $720.00 Direct labour (0.20 hours at $17.00 per hour) $3.40 Total standard costs per 100 kg container: $723.40 The following activities were recorded in June: 1. 1,800 containers were manufactured 2. 92,000 kg of materials costing $65,000 were purchased. 3. 202,000 kg of materials were used. 4. $21,000 was paid for 470 hours of direct labour. There were neither beginning nor ending WIP inventories on hand. Required: a) Compute the direct materials variances. 10 marks b) Compute the direct labour variances. 10 marks c) Suggest rational explanations for each variance. 5 marks
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