The direct materials and direct labour standards for one bottle of Clean-All spray cleaner are given below:
Standard Quantity or Hours |
Standard Price or Rate |
Standard Cost |
|||||
Direct materials | 6.0 | millilitres | $ | 0.28 | per millilitres | $ | 1.68 |
Direct labour | 0.6 | hours | $ | 12.00 | per hour | $ | 7.20 |
During the most recent month, the following activity was recorded:
Required:
Compute the direct materials price and quantity variances for the month. (Indicate the effect of each variance by selecting "F" for favourable, "U" for unfavourable, and "None" for no effect (i.e., zero variance).)
Solution
Material Price Variance | $ 1,350.00 | Favourable-F |
Material quantity variance | $ 3,080.00 | Unfavourable-U |
Alternate answer for material price variance= 1150 Favorable
Working
Material Price Variance | ||||||
( | Standard Rate | - | Actual Rate | ) | x | Actual Quantity |
( | $ 0.28 | - | $ 0.23 | ) | x | 27000 |
1350 | ||||||
Variance | $ 1,350.00 | Favourable-F |
.
Material Quantity Variance | ||||||
( | Standard Quantity | - | Actual Quantity | ) | x | Standard Rate |
( | 12000 | - | 23000 | ) | x | $ 0.28 |
-3080 | ||||||
Variance | $ 3,080.00 | Unfavourable-U |
.
Standard DATA for | 2000 | Units | |
Quantity (SQ) | Rate (SR) | Standard Cost | |
[A] | [B] | [A x B] | |
Direct Material | ( 6 millilitres x 2000 Units)=12000 millilitres | $ 0.28 | $ 3,360.00 |
.
Actual DATA for | 2000 | Units | |
Quantity (AQ) | Rate (AR) | Actual Cost | |
Direct Material | 23000 | $ 0.23 | $ 5,290.00 |
The direct materials and direct labour standards for one bottle of Clean-All spray cleaner are given...
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Jay Levitt Company budgeted the following cost standards for
the current year:
Direct materials (2 kg of
plastic at $6 per kilogram)
$12.00
Direct labour (2 hours at $12
per hour)
24.00
Variable manufacturing
overhead
11.90
Fixed manufacturing
overhead
6.25
Total standard cost per
unit
$54.15
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Direct materials used
5,560
kg
Direct materials purchased
(6,780 kg)
$40,002
Direct labour (6,880 hours)
$67,424
Variable manufacturing
costs
$32,600
Fixed manufacturing costs
$17,600
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Please help me correct my error, provide me the way to do it too
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