Question

Chap 21 Homework Reed Corp. has set the following standard direct materials and direct labor costs per unit for the product it manufactures Direct materials (15 lbs. 33 per lb.) Direct labor (3 hrs. $14 per hr.) 20 points During June the company incurred the following actual costs to produce 8,400 units Skipped Direct materiais (128,500 lbs. $2.75 per 10.) Direct labor (28,600 hrs. $14.15 per hr.). $353,375 404.600 Book AH = Actual Hours SH = Standard Hours AR = Actual Rate SR - Standard Rate Referencer AQ - Actual Quantity SQ - Standard Quantity AP = Actual Price SP - Standard Price (1) Compute the direct materials price and quantity variances. (Indicate the effect of each variance by selecting for favorable, unfavorable, and no variance.) (2) Compute the direct labor rate variance and the direct labor efficiency variance. (Indicate the effect of each variance by selecting for favorable, unfavorable, and no variance.) Complete this question by entering your answers in the tabs below.

Answer 1

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Parte Dm 128600 hrs] AQ - 728500 suoo 2 15.30 Lbs. - ISO = AB - SP = 15 lbs 82.75 per lb. $3 Pee Lb AH SH = AR = SR 3 3.40 hrs 8 400 3 hrs $ 14.15 pecha & 14 perhr. - Dil Direct Material price Variance = (SP-AP) AO ( $3-$2.75) 128 500 lbs $0.25/128 128 500 lbs. z $ 32125 (la Direct Maurice Qty Oty Variance <sp/Actual Qty Used) - St 2 $3 per L6 / 128 500 lbs - 84000 1563). 2 $3166 x 2500 lbs 9 7 500 I laval Direct Labor Rate Variance a stes (SR-AR) AH = ($14h0 - $14.15/hr) 28600 $ 4290 o Diseer labor efficienas variance. sell nenal Hrs) - and urg) 2. $14. 28600 - 3X 84022 $14 28 600 - 252001 2 $ 47600