Standard Cost and Flexible Budget. Brier Company produces car covers. The company's master budget shows the following standards information. Expected production for September 5,000 units 29. Direct materials 8 yards per unit at $5 per yard Direct labor 3 hours per unit at $16 per hour Variable manufacturing overhead Required: a. Caleulate the standard cost per unit for direct materials, direct labor, and variable manufacturing overhead using the format shown in Figure 10.1. 3 direct labor hours per unit at $2 per hour b. Assume Brier Company produced 5,100 car covers during the month of September. Prepare a flexible budget for direct materials, direct labor, and variable manufacturing overhead using the format shown in Figure 10.2. 30. Materials and Labor Variances. Brier Company produces car covers. (This is the same company as the previous exercise. This exercise can be assigned independently.) For direct materials, the standard price for i yard of material is $5 per yard. A standard quantity of 8 yards of material is expected to be used for each car cover produced. During September, Brier Company purchased 45,000 yards of material for $238,500 and used 39,000 yards to produce 5,10o0 car covers. For direct labor, Brier Company established a standard number of direct labor hours at three hours per car cover. The standard rate is $16 per hour. A total of 14,700 direct labor hours were worked during September, at a cost of $238,140, to produce 5,100 car covers. Required: a. Calculate the materials price variance and materials quantity variance using the format shown in Figure 10.4. Clearly label each variance as favorable or unfavorable. b. Calculate the labor rate varianee and labor efficiency variance using the format shown in Figure 10.6. Clearly label each variance as favorable or unfavorable. WPxls- Data Jools Window Hellp Edit View Insert FormatStyles Sheet a a a 11 L G C D E B XERCISES (Continued) Standard Cost and Flexible Budget 29. Standard cost per unit calculation a. Standard Cost per Unit Direct materials Direct labor Variable overhead Standard variable production cost per unit b. Flexible budget Flexible Budget at 5,100 Units Direct materials $204,000 Direct labor Variable overhead Total budgeted variable production costs at 5,100 units oWPak-Tro Office Calc Edt View nsert Foemat Styles Sheet Data Joos Window Help AlS % 00 a a a a E 11 TU S V R L M N P BC E F G H K D XERCISES (continued) 30. Materials and Labor Variances As hown below, the materials price variance is $13,500 Unfavorable a As hown below, the materials quantity vaniance is Actual Quantity at Standard Rate Standard Materials Costs Actual Materials Costs (Flexible Budget) -AQ x AP AQx SP - SQ x SP yardsx per yard yards per yard yards per yard $13,500 Unfaverable materials price variance AQE x SP yards per yard materials quantity variance E9 30 a E30 b 2 of 3 WPxk io Office Calc dt View Insert Formet Styles Sheet Dta Jools Window Help AS -% 00 a a a a - D EF V T U N B C G XERCISES (continued) 30. Materials and Labor Variances (continued) As shoun below, the labor rate variance is As houn below, the labor efficency variance is ($9,600) Favorable Standard Labor Costs Actual Hours at Standard Rate AH x SR (Flexible Budget) -SH x SR Actual Labor Costs -AHx AR hours per hour hours per hour hours per hour (S9.600) Favorable labor efficiency variance laber rate variance 129E0 )of3
