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In: Accounting

Better Than That Corporation makes a product with the following standard costs: Standard Quantity or Hours...

Better Than That Corporation makes a product with the following standard costs:

Standard Quantity or Hours

Standard Price or Rate

Direct materials

3.5

grams

$

1.00

per gram

Direct labor

0.7

hours

$

11.00

per hour

Variable overhead

0.7

hours

$

2.00

per hour

The company planned to produce 3,200 units of output during July and reported the following actual results concerning this product in July.

Actual output

3,000

units

Actual direct labor-hours

1,910

hours

Purchases of raw materials

12,100

grams

Actual price of raw materials purchased

$

1.20

per gram

Actual direct labor rate

$

11.40

per hour

Actual variable overhead rate

$

2.10

per hour

The company applies variable overhead on the basis of direct labor-hours. Assume all of the materials purchased were used during the month to produce the 3,000 units.

  1. Calculate the direct materials price variance.
  2. Calculate the direct materials quantity variance.
  3. Calculate the direct labor rate variance.
  4. Calculate the direct labor efficiency variance.
  5. Calculate the variable overhead rate variance.
  6. Calculate the variable overhead efficiency variance.

Solutions

Expert Solution

ekkarill92 answered 2 years ago
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