Question

please show your work

e product manufactured by Problem 3 (Textbook Reference: P8-6) - Compute materials and labor variances Based on a standard volume of 96.000 units per month the standard cost of the pro Tahoe Company consists of Direct materials (0.25 pounds x 58 per pound) 2.00 Direct labor (0.5 hours x $7.60 per hour) 3.80 Variable manuthcturing overhead per unit 2.50 1.50 Fixed manufacturing overhead ($144,000 in total) 9.80 00 units were produced with the A total of 25.200 pounds of materials was purchased at 8 40 mr d . During May, 98.400 units were pre following costs Direct materials used (24,000 pounds x $8.40 per pound) Direct labor (50,000 hours x $7.80 per hour) $ 390,000 Variable manufacturing overhead $ 249,000 Fixed manufacturing overhead $ 145,000 Required: (circle For U to indicate whether the variance is favorable or unfavorable) a. Compute the materials price variance: b. Compute the materials quantity usage variance c. Compute the total materials variance: d. Compute the labor mate variance $ 9000 $ 34,5 0 $44.160. O OOO O c. Compute the total materials variance: For For For . Compute the labor efficiency variance: Foru Compute the total labor variance: - Foru 218-8.4) ***You must show your work to receive credit *** 2400 8x19 686 157440lar, yours 9400 u 201600-1574MOS 2.2 498400, yux. 258.4 x 2400 20160o 19680 (19680 24000 8 $44160 10,0 34560 MPU MOV 9600 V 345600 10,000 U • a (7.6-7,8) 50,000 =

Answer 1

a.Material price Variance = (Standard Price – Actual Price)*Actual Quantity purchased

= (8-8.40)*25,200

= $10,080 U

Material Quantity Variance = (Standard Quantity – Actual Quantity Used)*Standard Price

= (98,400*0.25 – 24,000)*8

= $4,800 F

Total material variance = -10,080 + 4,800

= $5,280 U

Labor rate = (Standard rate – Actual rate)*Actual hours

= (7.60-7.80)*50,000

= $10,000 U

Efficiency = (Standard hours – Actual hours)*standard rate

= (98,400*0.5 – 50,000)*7.6

= $6,080 U

Total labor variance = 16,080 U