Madzinga\'s Draperies manufactures curtains. A certain window requires the follo
ID: 2471171 • Letter: M
Question
Madzinga's Draperies manufactures curtains. A certain window requires the following:
Direct materials standard 9 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 $69,300. Direct labor totaled 7,600 hours for $80,560.
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.
Explanation / Answer
Solution :
Qty
Rate
total
a. Material
Standard
13500
5.00
67500
9*1500
actual
14000
4.95
69300
(69300/14000)
Direct material Price variace
(AR-SR)*AQ
700
F
(4.95-5)*14000
Direct material efficiency variace
(AQ-SQ)*SR
2500
U
(14000-13500)*5
b. Labour
Hours
Rate
total
Standard
7500
10.00
75000
1500*5
actual
7600
10.60
80560
(80560/7600)
-5560
Direct Labour rate variace
(AR-SR)*AH
4560
U
(10.60-10)*7600
Direct lABOUR EFFICIENCY variace
(AH-SH)*SR
1000
U
(7600-7500)*10
AR/SR = ACTUAL/STANDARD RATE
AH/SH=ACTUAL/STANDARD HOURS
Qty
Rate
total
a. Material
Standard
13500
5.00
67500
9*1500
actual
14000
4.95
69300
(69300/14000)
Direct material Price variace
(AR-SR)*AQ
700
F
(4.95-5)*14000
Direct material efficiency variace
(AQ-SQ)*SR
2500
U
(14000-13500)*5
b. Labour
Hours
Rate
total
Standard
7500
10.00
75000
1500*5
actual
7600
10.60
80560
(80560/7600)
-5560
Direct Labour rate variace
(AR-SR)*AH
4560
U
(10.60-10)*7600
Direct lABOUR EFFICIENCY variace
(AH-SH)*SR
1000
U
(7600-7500)*10
AR/SR = ACTUAL/STANDARD RATE
AH/SH=ACTUAL/STANDARD HOURS
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