ay, Inc. designs and manufactures fleece quarter zio jackots, I slis its jackets
ID: 2508878 • Letter: A
Question
ay, Inc. designs and manufactures fleece quarter zio jackots, I slis its jackets to brand-name outdoor oufiters in ots of one dozen. Saly May's May 2017 static budget and actual results for direct inputs are as follows: (Click the icon to view the data ) Read the requirements ?(Click the icon to view additional information.) Requirement 1. Calculate the direct materials and direct manufacturing labor price and efficiency variances in May 2017. What is the total flexible-budget variance fo both inputs (direct materials and direct manufacturing labor) combined? What percentage is this variance of the total cost of direct materials and direct manufacturing labor in the flexible budget? Begin by calculating the direct materials and direct manufacturing labor price and efficiency variances in May 2017. Complete the actual results, price variance, and cost columns, then the efficiency variance and flexible budget columns. Label each variance as favorable or unfavorable. (Round all answers to the nearest cent.) Actual Price Actual Input aty xExplanation / Answer
1) Statement showing price variance (Amounts in $)
Direct Material Efficiency Variance = (Std Qty - Actual Qty)*Std Price
= [(425 lots*12 yards) - 5,950 yards]*$1.20 per yard
= (5,100 - 5,950)*$1.20 = ($1,020) Unfavorable
Direct Manufacturing Labor Efficiency Variance = (Std Hrs - Actual Hrs)*Std Rate
= [(425 lots*2.10 hrs) - 808 hrs]*$8.40 per hour = $709.80 Favorable
Total Efficiency Variance = Material Efficiency Variance+Labor Efficiency Variance
= ($1,020)+$709.80 = ($310.20) Unfavorable
May 2017 Actual results Price Variance Actual Input Qty*Budgeted Price Units 425 lots Direct Materials 8,330 (7,140-8,330) = (1,190) Unfavorable (5,950*$1.20) = $7,140 Direct Labor 6,868 (6,787.20-6,868) = (80.80) Unfavorable (808 hrs*$8.40) = $6,787.20 Total Variance (1,270.80) UnfavorableRelated Questions
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