Question

irefox View Policies Current Attempt in Progress Levine Inc, which produces a single product, has prepared the following standard cost sheet for one unit of the product. Direct materials (6 pounds at $1.30 per pound) $10.80 Direct labor (4 hours at $13.00 per hour) $52.00 Creat During the month of April, the company manufactures 170 units and incurs the following actual costs. Direct materials purchased and used (1,900 pounds) $3,610 Direct labor (720 hours) $9,288 Compute the total price and quantity variances for materials and labor. Total materials variance Materials price variance Materials quantity variance $ 11 Total labor variance Labor price variance Cry Labor quantity variance e Textbook and Media Attempts: 0 of 3 used to Submit Answer

Answer 1

Solution:

Direct Material Cost Variance
Actual Cost					Standard cost for actual quantity					Standard Cost
AQ *	AP =				AQ *	SP =				SQ *	SP =
1900	$1.90	$3,610.00			1900	$1.80	$3,420.00			1020	$1.80	$1,836.00
			$190.00	U				$1,584.00	U
			Direct Material Price Variance					Direct Material Qty variance
Direct material price variance					$190.00	U
Direct material quantity variance					$1,584.00	U
Direct material cost variance					$1,774.00	U

Direct Labor Cost Variance
Actual Cost					Standard cost for actual quantity					Standard Cost
AH *	AR =				AH *	SR =				SH *	SR =
720	$12.90	$9,288.00			720	$13.00	$9,360.00			680	$13.00	$8,840.00
			$72.00	F				$520.00	U
			Direct Labor rate Variance					Direct Labor Efficiency Variance
Direct Labor Rate variance					$72.00	F
Direct Labor Efficiency variance					$520.00	U
Direct labor cost variance					$448.00	U