Exercise 23-7 Levine Inc., which produces a single product, has prepared the fol

Question

Exercise 23-7 Levine Inc., which produces a single product, has prepared the following standard cost sheet for one unit of the product. Direct materials (8 pounds at $2.40 per pound) Direct labor (5 hours at $12.00 per hour) During the month of April, the company manufactures 260 units and incurs the following actual costs. Direct materials purchased and used (2,400 pounds) Direct labor (1,310 hours) Compute the total, price, and quantity variances for materials and labor. $19.20 $60.00 $6,240 $15,458 Total materials variance Materials price variances Materials quantity variances Total labor variance Labor price variance Labor quantity variance s

Explanation / Answer

a) Total material variane = (260*19.20-6240) = 1248 U

b) Material price variance = (2.4*2400-6240) = 480 U

C) Material quantity variance = (260*8-2400)*2.4 = 768 U

d) Total labour variance = (260*60-15458) = 142 F

e) Labour price variance = (12*1310-15458) = 262 F

f) Labour quantity variance = (260*5-1310)*12 = 120 U

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