Question
La Batre Bicycle Company manufactures commuter bicycles from recycled materials. The following data for July of the current year are available: Quantity of direct labor
La Batre Bicycle Company manufactures commuter bicycles from recycled materials. The following data for July of the current year are available:
Quantity of direct labor used | 560 hrs. |
Actual rate for direct labor | $13.9 per hr. |
Bicycles completed in April | 260 bicycles |
Standard direct labor per bicycle | 2 hrs. |
Standard rate for direct labor | $14.2 per hr. |
a. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.
Direct Labor Rate Variance | $ | |
Direct Labor Time Variance | $ | |
Total Direct Labor Cost Variance | $ |
b. How much direct labor should be debited to Work in Process? $
At the beginning of June, Bezco Toy Company budgeted 12,000 toy action figures to be manufactured in June at standard direct materials and direct labor costs as follows:
Direct materials | $21,000 |
Direct labor | 8,400 |
Total | $29,400 |
The standard materials price is $0.7 per pound. The standard direct labor rate is $10 per hour. At the end of June, the actual direct materials and direct labor costs were as follows:
Actual direct materials | $18,700 |
Actual direct labor | 7,500 |
Total | $26,200 |
There were no direct materials price or direct labor rate variances for June. In addition, assume no changes in the direct materials inventory balances in June. Bezco Toy Company actually produced 10,400 units during June.
Determine the direct materials quantity and direct labor time variances. Round your per unit computations to two decimal places, if required. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.
Direct materials quantity variance | $ | |
Direct labor time variance | $ |
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