Which of the following statements about direct material variances are likely to be true? Differences between...
Which of the following statements about direct material variances are likely to be true?
- Differences between the actual production level and budgeted (expected) production level is NOT a reason why direct materials quantity (or efficiency) variances arise.
- A direct materials quantity (or efficiency) variance can arise due to factors outside the production manager's control
- A direct materials quantity (or efficiency) variance will arise
if the organisation manages to negotiate a better price for its
materials compared to what it had expected when constructing the
static budget
Statement 1 only
Statement 2 only
Statement 3 only
Statement 1 and 2 only
Statement 1, 2 and 3
Homework Answers
Direct materials quantity variance = (Actual quantity * Standard price) - (Standard quantity * Standard price)
The answer is Statement 1 and 2 only.
Add Answer to:
Which of the following statements about direct material
variances are likely to be true?
Differences between...
Direct Material Variances Goldman, Inc. is a manufacturer of lead crystal glasses. The standard direct materials quantit...
Direct Material Variances Goldman, Inc. is a manufacturer of lead crystal glasses. The standard direct materials quantity is 0.7 pounds per glass at the cost of $0.35 per pound. The actual result for one month’s production of 6,950 glasses was 1.3 pounds per glass, at the cost of $0.45 per pound. Calculate the direct materials cost variance and the direct materials efficiency variance. Direct Labour Variances Goldman, Inc. manufactures lead crystal glasses. The standard direct labor time is 0.5 hours...
Exercise 21-15 Direct materials and direct labor variances LO P2 The following information describes production activities...
Exercise 21-15 Direct materials and direct labor variances LO P2 The following information describes production activities of Mercer Manufacturing for the year. Actual direct materials used Actual direct labor used Actual units produced 27,000 lbs. at $4.75 per lb. 8,600 hours for a total of $172,860 51,000 Budgeted standards for each unit produced are 0.50 pounds of direct material at $4.70 per pound and 10 minutes of direct labor at $21.00 per hour. AQ = Actual Quantity SQ = Standard...
Exercise 08-15 Direct materials and direct labor variances LO P3 The following describes production activities of...
Exercise 08-15 Direct materials and direct labor variances LO P3 The following describes production activities of Mercer Manufacturing for the year. 34,000 lbs. at $5.95 per lb 10,600 hours for a total of $220,480 Actual direct materials used Actual direct labor used Actual units produced 63,300 Budgeted standards for each unit produced are 0.50 pound of direct material at $5.90 per pound and 10 minutes of direct labor at $21.80 per hour. AH Actual Hours SH Standard Hours AR Actual...
Exercise 08-15 Direct materials and direct labor variances LO P3 The following describes production activities of...
Exercise 08-15 Direct materials and direct labor variances LO P3 The following describes production activities of Mercer Manufacturing for the year. Actual direct materials used Actual direct labor used Actual units produced 30,000 lbs. at $5.15 per lb. 9,150 hours for a total of $186,660 54,120 Budgeted standards for each unit produced are 0.50 pound of direct material at $5.10 per pound and 10 minutes of direct labor at $21.40 per hour. AH = Actual Hours SH = Standard Hours...
Check my work Exercise 08-15 Direct materials and direct labor variances LO P3 The following describes...
Check my work Exercise 08-15 Direct materials and direct labor variances LO P3 The following describes production activities of Mercer Manufacturing for the year Ketual direct materials used Actual direct labor used Actual units produced 27,000 lbs. at $4.75 per lb. 8,600 hours for a total of $172,860 51.000 Budgeted standards for each unit produced are 0.50 pound of direct material at $4.70 per pound and 10 minutes of direct labor at $21.00 per hour. AH - Actual Hours SH...
1. Compute the price and quantity variances for direct materials. Compute the rate and efficiency variances...
1. Compute the price and quantity variances for direct materials. Compute the rate and efficiency variances for direct labor. Does the pattern of variances suggest that the company's managers have been making trade-offs? Explain. 2, Bargain Guard, which used a standard cost accounting system, manufactured 200,000 boat fenders during the year, using 1,250,000 feet of extruded vinyl purchased at $1.40 per foot. Production required 4,000 direct labor hours that cost $14.50 per hour. The materials standard was 6 feet of...
Exercise 23-12 Direct materials and direct labor variances LO P2 Reed Corp, has set the following...
Exercise 23-12 Direct materials and direct labor variances LO P2 Reed Corp, has set the following standard direct materials and direct labor costs per unit for the product it manufactures Direct materials (16 lbs. @ 4 per 1b. Direct labor (3 hrs. @ $16 per hr.) During June the company incurred the following actual costs to produce 8,300 units. Direct materials (135,700 lbs. @ $3.75 per lb.) Direct labor (28,100 hrs. @ $16.15 per hr.). $588,875 453,815 AH - Actual...
Check my work Exercise 21-15 Direct materials and direct labor variances LO P2 The following information...
Check my work Exercise 21-15 Direct materials and direct labor variances LO P2 The following information describes production activities of Mercer Manufacturing for the year. points Skipped Actual direct materials used 25,000 lbs. at $4.60 per lb. Actual direct labor used 6,050 hours for a total of $120,395 Actual units produced 36,000 eBook Hint Print Budgeted standards for each unit produced are 0.50 pounds of direct material at $4.55 per pound and 10 minutes of direct labor at $20.90 per...
Material and Labor Variances The following actual and standard cost data for direct material and direct...
Material and Labor Variances The following actual and standard cost data for direct material and direct labor relate to Jones Company's production of 2,000 units of a product: Actual Costs Standard Costs Direct material 4,200 lbs. @ $4.90 4,000 lbs. @ $5.10 Direct labor 5,800 hrs. @ $9.30 6,000 hrs. @ $9.50 Determine the following variances: Do not use negative signs with any of your answers, Next to each variance answer, select either "F" for Favorable or "U" for Unfavorable....
Material and Labor Variances The following actual and standard cost data for direct material and direct...
Material and Labor Variances The following actual and standard cost data for direct material and direct labor relate to the production of 2,000 units of a product: Actual Costs Standard Costs Direct material 7,800 lbs. @ $5.30 8,000 lbs. @ $5.10 Direct labor 12,400 hrs. @ $8.40 12,000 hrs. @ $8.70 Determine the following variances: Do not use negative signs with any of your answers. Next to each variance answer, select either "F" for Favorable or "U" for Unfavorable Materials...
Exercise 21-15 Direct materials and direct labor variances LO P2 The following information describes production activities of Mercer Manufacturing for the year. Actual direct materials used Actual direct labor used Actual units produced 27,000 lbs. at $4.75 per lb. 8,600 hours for a total of $172,860 51,000 Budgeted standards for each unit produced are 0.50 pounds of direct material at $4.70 per pound and 10 minutes of direct labor at $21.00 per hour. AQ = Actual Quantity SQ = Standard...
Exercise 08-15 Direct materials and direct labor variances LO P3 The following describes production activities of Mercer Manufacturing for the year. 34,000 lbs. at $5.95 per lb 10,600 hours for a total of $220,480 Actual direct materials used Actual direct labor used Actual units produced 63,300 Budgeted standards for each unit produced are 0.50 pound of direct material at $5.90 per pound and 10 minutes of direct labor at $21.80 per hour. AH Actual Hours SH Standard Hours AR Actual...
Exercise 08-15 Direct materials and direct labor variances LO P3 The following describes production activities of Mercer Manufacturing for the year. Actual direct materials used Actual direct labor used Actual units produced 30,000 lbs. at $5.15 per lb. 9,150 hours for a total of $186,660 54,120 Budgeted standards for each unit produced are 0.50 pound of direct material at $5.10 per pound and 10 minutes of direct labor at $21.40 per hour. AH = Actual Hours SH = Standard Hours...
Check my work Exercise 08-15 Direct materials and direct labor variances LO P3 The following describes production activities of Mercer Manufacturing for the year Ketual direct materials used Actual direct labor used Actual units produced 27,000 lbs. at $4.75 per lb. 8,600 hours for a total of $172,860 51.000 Budgeted standards for each unit produced are 0.50 pound of direct material at $4.70 per pound and 10 minutes of direct labor at $21.00 per hour. AH - Actual Hours SH...
1. Compute the price and quantity variances for direct materials. Compute the rate and efficiency variances for direct labor. Does the pattern of variances suggest that the company's managers have been making trade-offs? Explain. 2, Bargain Guard, which used a standard cost accounting system, manufactured 200,000 boat fenders during the year, using 1,250,000 feet of extruded vinyl purchased at $1.40 per foot. Production required 4,000 direct labor hours that cost $14.50 per hour. The materials standard was 6 feet of...
Exercise 23-12 Direct materials and direct labor variances LO P2 Reed Corp, has set the following standard direct materials and direct labor costs per unit for the product it manufactures Direct materials (16 lbs. @ 4 per 1b. Direct labor (3 hrs. @ $16 per hr.) During June the company incurred the following actual costs to produce 8,300 units. Direct materials (135,700 lbs. @ $3.75 per lb.) Direct labor (28,100 hrs. @ $16.15 per hr.). $588,875 453,815 AH - Actual...
Check my work Exercise 21-15 Direct materials and direct labor variances LO P2 The following information describes production activities of Mercer Manufacturing for the year. points Skipped Actual direct materials used 25,000 lbs. at $4.60 per lb. Actual direct labor used 6,050 hours for a total of $120,395 Actual units produced 36,000 eBook Hint Print Budgeted standards for each unit produced are 0.50 pounds of direct material at $4.55 per pound and 10 minutes of direct labor at $20.90 per...
Material and Labor Variances The following actual and standard cost data for direct material and direct labor relate to Jones Company's production of 2,000 units of a product: Actual Costs Standard Costs Direct material 4,200 lbs. @ $4.90 4,000 lbs. @ $5.10 Direct labor 5,800 hrs. @ $9.30 6,000 hrs. @ $9.50 Determine the following variances: Do not use negative signs with any of your answers, Next to each variance answer, select either "F" for Favorable or "U" for Unfavorable....
Material and Labor Variances The following actual and standard cost data for direct material and direct labor relate to the production of 2,000 units of a product: Actual Costs Standard Costs Direct material 7,800 lbs. @ $5.30 8,000 lbs. @ $5.10 Direct labor 12,400 hrs. @ $8.40 12,000 hrs. @ $8.70 Determine the following variances: Do not use negative signs with any of your answers. Next to each variance answer, select either "F" for Favorable or "U" for Unfavorable Materials...
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