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Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labour standards for one unit of Zoom are given below:
Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labour standards for one unit of Zoom are given below: |
Standard quantity or hours | Standard price or rate | Standard cost | ||||||
Direct materials | 3.5 | kilos | 1.50 | per kilo | 5.25 | |||
Direct labour | 0.3 | hours | 9.00 | per hour | 2.70 | |||
During the most recent month, the following activity was recorded: | |
1. | 25,000 kilos of material were purchased at a cost of 1.40 per kilo. |
2. | Huron Company produced 5,000 units of Zoom, using 22,000 kilos of material in the production process. (The rest of the material purchased remained in inventories.) |
3. | A total of 10,500 hours of direct labour time was recorded at a total labour cost of 109,200. |
Requirement 1: | |
Compute the direct materials price variance for the month. (Do not round intermediate calculations.) | |
Requirement 2: | |
Compute the direct materials quantity variance for the month. | |
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