Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Puvo, Incorporated, manufactures a single product in which variable manufacturing overhead is assigned on the basis of standard direct labor-hours. The company uses a standard

Puvo, Incorporated, manufactures a single product in which variable manufacturing overhead is assigned on the basis of standard direct labor-hours. The company uses a standard cost system and has established the following standards for one unit of product:

Standard Quantity Standard Price or Rate Standard Cost
Direct materials 5.8 pounds $ 0.60 per pound $ 3.48
Direct labor 0.5 hours $ 33.50 per hour $ 16.75
Variable manufacturing overhead 0.5 hours $ 8.50 per hour $ 4.25

During March, the following activity was recorded by the company:

  • The company produced 2,400 units during the month.
  • A total of 19,400 pounds of material were purchased at a cost of $13,580.
  • There was no beginning inventory of materials on hand to start the month; at the end of the month, 3,620 pounds of material remained in the warehouse.
  • During March, 1,090 direct labor-hours were worked at a rate of $30.50 per hour.
  • Variable manufacturing overhead costs during March totaled $14,061.

The direct materials purchases variance is computed when the materials are purchased.

The labor efficiency variance for March is:

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

2001 Miller Audit Procedures Miller Engagement

Authors: George Georgiades

1st Edition

0156071940, 978-0156071949

More Books

Students also viewed these Accounting questions

Question

3. What are the costs involved in this situation? 60

Answered: 1 week ago