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Jackson Industries employs a standard cost system in which direct materials inventory is carried at standard cost. Jackson has established the following standards for the
Jackson Industries employs a standard cost system in which direct materials inventory is carried at standard cost. Jackson has established the following standards for the prime costs of one unit of product: During May, Jackson purchased 125,000 pounds of direct materials at a total cost of $475,000. The total factory wages for May were $364,000,90% of which were direct labor. Jackson manufactured 22,000 units of product during May using 108,000 pounds of direct materials and 28,000 direct labor hours. 4. What is Jackson's direct material usage variance? a. $36,000 favorable b. $7,200 unfavorable c. $7,200 favorable d. $61,200 favorable e. $61,200 unfavorable 5. What is Jackson's direct labor efficiency variance? a. $7,500 unfavorable b. $8,400 unfavorable c. $6,000 favorable d. $6,000 unfavorable e. $8,400 favorable
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