Madzinga's Draperies manufactures curtains. A certain window requires the following:
Direct materials standard 10 square yards at $5 per yard
Direct manufacturing labor standard 5 hours at $10
During the second quarter, the company made 1.500 curtains and used 14.000 square yards of fabric costing $68, 600. Direct labor totaled 7, 600 hours for $79, 800.
Required
a. Compute the direct materials price and efficiency variances for the quarter.
b. Compute the direct manufacturing labor price and efficiency variances for the quarter

Question

contestada

Respuesta :

facundobuzzetti facundobuzzetti · Answer 1 · 2021-04-24T02:34:40+02:00

Answer:

Results are below.

Explanation:

To calculate the direct material price and quantity variance, we need to use the following formulas:

Direct material price variance= (standard price - actual price)*actual quantity

Direct material price variance= (5 - 4.9)*14,000

Direct material price variance= $1,400 favorable

Actual price= 68,600/14,000= $4.9

Direct material quantity variance= (standard quantity - actual quantity)*standard price

Direct material quantity variance= (1,500*10 - 14,000)*5

Direct material quantity variance= $5,000 favorable

To calculate the direct labor efficiency and rate variance, we need to use the following formulas:

Direct labor time (efficiency) variance= (Standard Quantity - Actual Quantity)*standard rate

Direct labor time (efficiency) variance= (5*1,500 - 7,600)*10

Direct labor time (efficiency) variance= $1,000 unfavorable

Direct labor rate variance= (Standard Rate - Actual Rate)*Actual Quantity

Direct labor rate variance= (10 - 10.5)*7,600

Direct labor rate variance= $3,800 unfavorable

Actual rate= 79,800 / 7,600= $10.5