Question
Skold Company produce s s lacks. Materials for the s l ac ks are dyed in lar ge vats . After d ye ing the
Skold Company produces slacks. Materials for the slacks are dyed in large vats. After dyeing the materials for a given colour, the vats must be cleaned and prepared for the next batch of materials to be coloured. The following standards for changeover for a given batch have been established:
Direct materials (2.5 kg @ $1.20) _______ $ 3
Direct labour (0.40 hr. @ $16.00) _______ $ 6.40
Standard prime cost _________________ $ 9.40
During the year, 79.500 kilograms of material were purchased and used for the changeover activity. There were 30,000 batches produced, with the following actual prime costs:
Direct materials _________$ 86,800
Direct labour ____________173,850 (for 11,400 hrs.)
Required:
- Compute the materials and labour variances associated with the changeover activity, labelling each variance as favourable or unfavourable.
- Find the total material variance and total labour variance labelling each variance as favourable or unfavourable
Step by Step Solution
There are 3 Steps involved in it
Step: 1
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-text-image.webp)
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Step: 3
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started