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:
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 Standard Price
or Rate Standard
Cost
or Hours
Direct materials . . . . . . . . . . 4.6 pounds $2.50 per pound $11.50
Direct labor . . . . . . . . . . . . . 0.2 hours $12.00 per hour $2.40
During the most recent month, the following activity was recorded:
a. Twenty thousand pounds of material were purchased at a cost of $2.35 per pound.
b. All of the material purchased was used to produce 4,000 units of Zoom.
c. 750 hours of direct labor time were recorded at a total labor cost of $10,425.
Required
1. Compute the materials price and quantity variances for the month, show the total
material spending variance.
2. Compute the labor rate and efficiency variances for the month, show the labor
spending (total) variance
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