Question

Direct materials Direct labor Factory overhead Actual Costs 9,800 lb. at $5.60 1,940 hrs. at $16.90 Standard Costs 9,900 lb. at $5.70 1,900 hrs. at $16.70 Rates per direct labor hr., based on 100% of normal capacity of 1,980 direct labor hrs.: Variable cost, $4.30 $8,090 variable cost $13,464 fixed cost Fixed cost, $6.80 Each unit requires 0.25 hour of direct labor. Required: a. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance, Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number Direct materials price variance 980 Favorable Direct materials quantity variance 570 Favorable Total direct materials cost variance $ 1,550 Favorable b. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number Direct labor rate variance $ 388 Unfavorable Direct labor time variance 600 Unfavorable Total direct labor cost variance $ 1,056 Unfavorable c. Determine variable factory overhead controllable variance, the fixed factory overhead volume variance, and total factory overhead cost variance Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number Variable factory overhead controllable variance Favorable Fixed factory overhead volume variance Unfavorable Total factory overhead cost variance favorable

Answer 1

c) calculation overhead varlance : - Variable overhead controllable varlance fixed = (standard rate - Actual Rate) Actual hours E :( 4.30 X 1940 – 8090) = 252 favornette factory overhead volume varlance = (standard hour - Actual hour) St. Rate = [ 1900 - 1940)¥ 6080 = 272] unfavourable

Total factory overhead volume variance = ( Standard cost - Actual cost) z ( llot X 1900 – 21554) = 464) unfavourable. vo