Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards
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Question:
Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below:
Standard Quantity or Hours | Standard Price or Rate | Standard Cost | |||
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Direct materials | 7.50 | pounds | $ 2.40 | per pound | $ 18.00 |
Direct labor | 0.80 | hours | $ 7.00 | per hour | $ 5.60 |
During the most recent month, the following activity was recorded:
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13,250.00 pounds of material were purchased at a cost of $2.20 per pound.
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All of the material purchased was used to produce 1,500 units of Zoom.
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1,000 hours of direct labor time were recorded at a total labor cost of $9,000.
Required:
1. Compute the materials price and quantity variances for the month.
2. Compute the labor rate and efficiency variances for the month.
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