QuantityPrice $UnitCost per pair of jeans $Denim fabric meters210/metre20.00Direct labour hours220/hour40.00Variable factory overhead0.410/hour4.00Fixed factory overhead0.420/hour8.00Total standard cost

72.00

The fixed overhead rate is based on an estimated 600 units per month. Direct labour is nearly a fixed cost in this business. Selling and administrative costs are $4500 per month plus $2 per pair of jeans sold. The following information is for production during April:

UnitsNumber of pairs of jeans made565JeansPurchase of 1200 metres of denim13,200$Number of metres used1,150metresDirect labour costs (1200 hours)24,500$Variable factory overhead costs2,750$Fixed factory overhead costs4,020$Selling and administrative costs3,770$

Divine Denim's policy is to record materials price variances at the time materials are purchased. Use a spreadsheet to perform calculations.

1. production cost variance report for April
2. report that sums all the variances necessary to prepare the reconciling journal entry at the end of the period. Explain how you would close the total variance; that is, identify the account or accounts that would be affected, and whether expenses in the accounts will be increased or decreased to adjust the records for the total variance.
3. use information in the April production cost variance report (part v. above) to identify and describequestions Helen, the owner of Devine Denim, might have about April's production costs.