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The standards for one carton of Flavor Rite are: Direct materials 3.2 lbs. @ $6.00/lb.Direct labor 2.4 hrs. @ $10.00/hr. During the week ended May
The standards for one carton of Flavor Rite are:
Direct materials 3.2 lbs. @ $6.00/lb.Direct labor 2.4 hrs. @ $10.00/hr.
During the week ended May 17, the following activity took place:
- 4,800 lbs. of raw material were purchased for inventory at a cost of $5.60 per pound;
- 1,200 cartons of finished product were produced;
- 4,020 lbs. of raw material were used;
- 3,110 labor hours were worked at a total cost of $26,435.
Calculate each of the following variances:(a.)Raw materials purchase price variance.(b.)Raw materials usage variance.(c.)Direct labor rate variance.(d.)Direct labor efficiency variance.(e.)Explain the factors that most likely caused the variances computed above.
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