Upstate Co. manufactures a product that has the following standard costs per unit: Direct materials:...

Upstate Co. manufactures a product that has the following standard costs per unit:

Direct materials: 40 yards at $2.70 per yard $108

Direct labor: 7 hours at $18 per hour 126

Total $234

Following information pertains to July:
     Direct material purchased: 42,500 yards at $2.78 per yard
     Direct material used: 38,000 yards
     Direct labor used: 7,500 hours at $18.30 per hour
     Budgeted production: 1,200 units

Actual completed production: 1,050 units

Calculate the direct-material price and quantity variances, and the direct-labor rate and efficiency variances. Indicate whether each variance is favorable or unfavorable. Also, briefly explain about the possible cause(s) of the variances.

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Expert Solution

ekkarill92 answered 1 year ago

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