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My UND IUND: UnivertConnect ? https://new connect mheducation.com/flow Appssyllabus fine arts connect.htmlisRegztrue&returnUr;?https%3A%2F%2Fconnect. heducation.com%2Fpaa web%2Findex.html%23%2Fregistration%2Fs? ? Ch. 10: Homework6 Saved Help Save & Exit Submit 5 Check my work 2 Exercise 10-7 Direct Materials Variances [LO10-1] Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below points Standard Quantity or Hours 6.10 pounds Standard Cost $15.25 $ 4.75 Standard Price or Rate eBook Direct materials Direct labor $2.50 per pound $9.50 per hour Print 8.50 hours References During the most recent month, the following activity was recorded: a. Eleven thousand eight hundred pounds of material were purchased at a cost of $2.40 per pound. b. The company produced only 1,180 units, using 10,620 pounds of material. (The rest of the material purchased remained in raw materials inventory.) C. 690 hours of direct labor time were recorded at a total labor cost of $8,280. Required Compute the materials price and quantity variances for the month. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values. Do not round intermediate calculations.) Mc Graw Pre 2 of 3 Next >

Explanation / Answer

Standard Cost PU: Amount F/UF Particulars Qty Rate Amount Material Price Variance: Direct Material 6.10 2.50 15.25 (SP-AP)AQ Direct Labor 0.50 9.50 4.75 (2.50-2.40)*10620 1062 Favourable 20.00 Actual Units 1180 Material Efficiency Variance: (SQ-AQ)SP Standard Cost for Actual Units: (7198-10620)*2.50 -8555 Unfavourable Particulars Qty Rate Amount Direct Material 7,198 2.50 17,995 Material Cost Variable -7,493 Unfavourable Direct Labor 590 9.50 5,605 (SC-AC) 23,600 Labor Price Variance: Actual Cost : (SP-AP)AQ Particulars Qty Rate Amount (9.50-12)*690 -1725 Unfavourable Direct Material 10,620 2.40 25,488 Direct Labor 690 12.00 8,280 Labor Efficiency Variance: (8280/690) 33,768 (SQ-AQ)SP (590-690)*9.50 -950 Unfavourable Short forms used: Labor Cost Variable -2,675 Unfavourable AQ Actual Quantity (SC-AC) SQ Standard Quantity AP Actual Price SP Standard Price SC Standard Cost AC Actual Cost

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