The following data for the Prender Company pertain to the production of 800 urns

ID: 2498800 • Letter: T

Question

The following data for the Prender Company pertain to the production of 800 urns during August.

Direct Materials (all materials purchased were used):

Standard cost: $4.80 per pound of urn.

Total actual cost: $4,480.

Standard cost allowed for units produced was $4,800

Materials efficiency variance was $96 unfavorable.

Direct Manufacturing Labor:

Standard cost is 2 urns per hour at $19.20 per hour.

Actual cost per hour was $19.60.

Labor efficiency variance was $288 favorable.

Required:

a. What is standard direct material amount per urn?

b. What is the direct material price variance?

c. What is the total actual cost of direct manufacturing labor?

d. What is the labor price variance for direct manufacturing labor?

Standard direct material amount per urn = Standard cost per pound of urn * Number of urns

= $4.80 per pound of urn * 800 urns

= $3,840

Direct material price variance = (Standard price – Actual price)*Actual quantity

Actual price = (Actual cost/Number of urns used or actual quantity)

= $4,480/800 urns (All materials purchased were used)

= $5.6 per pound of urn

Direct material price variance = (Standard price – Actual price)*Actual quantity

= ($4.80 per pound of urn - $5.6 per pound of urn)*800 urns

= $0.8*800 urns

= $640 Unfavorable

Actual cost of direct manufacturing labor = Actual cost direct manufacturing labor per hour*Number of hours

= $19.60 per hour*(800 urns/2 urns per hour)

= $19.60 per hour*400 hours

= $7,840

Labor price variance for direct manufacturing labor = (Standard rate – Actual rate)*Actual hours worked

= ($19.20 per hour - $19.60 per hour)* 800 urns/2 urns per hour

= ($0.4)*400 hours

= $160 Unfavorable

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