I am unsure if I did this correctly- would like a second opinion. This is how I came up with those answers:
Direct Materials Cost Variance= (1.45-1.40)x 2,800 = $140 Favorable or Unfavorable?
Direct Labor Cost Variance= (9.00-9.50)x 1,400= ($700) Favorable or Unfavorable?
Direct Materials Efficiency Variance= (2,800 - (1,000 x 3)) x 1.40 = (280) Favorable or Unfavorable?
Direct Labor Efficiency Variance= (1,400 - (1,000 x 2)) x 9.50= ($5,700) Favorable or Unfavorable?
I dont feel like I did these all correctly so please help me out if you can! I also really need the answers to whether each one is favorable (f) or unfavorable (u).
i Requirements 1. What are the benefits of setting cost standards? 2. Calculate the direct materials cost variance and the direct materials efficiency variance as well as the direct labor cost and efficiency variances. Print Done Quality, Inc. produced 1,000 units of the company's product in 2018. The standard quantity of direct materials was three yards of cloth per unit at a standard cost of $1.40 per yard. The accounting records showed that 2,800 yards of cloth were used and the company paid $145 per yard. Standard time was two direct labor hours per unit at a standard rate of $9.50 per direct labor hour. Employees worked 1.400 hours and were paid $9.00 per hour Read the requirements Requirement 1. What are the benefits of setting cost standards? Standard costing helps managers do the following Prepare the master budget Serage levels of performance for the budgets Mertly performance standards De s pres of products and services Decrease accounting Requirement 2. Ca t hedrales contrace and the direct mais ciency variance as well as the direct whor cost and efficiency variances Choose from a list or enter y number in the input fields and then continue to the next question. Quality, Inc. produced 1,000 units of the company's product in 2018. The standard quantity of direct materials was three yards of cloth per unit at a standard cost of $1.40 per yard. The accounting records showed that 2,800 yards of cloth were used and the company paid $145 per yard. Standard time was two direct labor hours per unit at a standard rate of $9.50 per direct labor hour. Employees worked 1.400 hours and were paid $9.00 per hour Read the requirements Requirement 2. Calculate the direct materials cost variance and the direct materials efficiency variance as well as the direct labor cost and efficiency variances. Begin with the cost variances. Select the required formulas, compute the cost variances for direct materials and direct labor, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations used: AC actual cost; AQ - actual quantity, FOH - fixed overhead; SC = standard cost; SQ - standard quantity) Direct materials cost variance Direct labor cost variance Formula (AC-SC) XAQ (AC-SC) XAQ Variance $140U $700 F Select the required formulas, compute the efficiency variances for direct materials and direct labor, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations Ured: AC actual cost; AQ actual quantity, FOH - faxed overhead: SC standard cost: SQ standard quantity) Choose from any list or enter any number in the input fields and then continue to the next question Quality, Inc. produced 1,000 units of the company's product in 2018. The standard quantity of direct materials was three yards of cloth per unit at a standard cost of $1.40 per yard. The accounting records showed that 2,800 yards of cloth were used and the company paid $1.45 per yard Standard time was two direct labor hours per unit at a standard rate of $9.50 per direct labor hour. Employees worked 1,400 hours and were paid $9.00 per hour. Read the requirements - Direct materials cost variance Direct labor cost variance Formula (AC-SC) XAQ (AC-SC) XAQ Variance $140 $700 U F Select the required formulas, compute the efficiency variances for direct materials and direct labor, and identify whether each variance is favorable (5) or unfavorable (U). (Abbreviations used: AC actual cost: AQ actual quantity, FOHfaced overhead: SC standard cost SQ standard quantity) Formula Direct materiais efficiency variance Direct labor efficiency variance - (AQ - SQ)X SC (AQSQ)X SC Variance $280 $5,700 F U Choose from any list or enter any number in the input fields and then continue to the next
