Healing Touch
Healing Touch manufactures massage chairs with the following standard cost structure:
Standard Cost Sheet: Massage Chair | ||
Metal tubing | 6 meters @ $3 | $ 18.00 |
Leather | 2 square meters @ $7 | 14.00 |
Padding | 3 kilograms @ $4 | 12.00 |
Direct labor | 4 hours @ $15 | 60.00 |
Total standard cost | $104.00 | |
During the month 500 chairs are manufactured and the following costs incurred:
Actual Costs Incurred for the Month: Massage Chair | ||
Metal tubing | 3,100 meters | $ 9.455 |
Leather | 1.100 square meters | 7.722 |
Padding | 1.600 kilograms | 6.560 |
Direct labor | 1.800 hours | 27,270 |
Total cost |
| $51,007 |
Required:
a. Calculate all materials and labor variances (including price, quantity, wage rate, and labor efficiency variances).
b. Write a short report summarizing and analyzing the manufacturing operations for the month.
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