Help Save & Ex Sharp Company manufactures a product for which the following stan
ID: 2556824 • Letter: H
Question
Help Save & Ex Sharp Company manufactures a product for which the following standards have been set uant ity standard Price r Hours erials 5 per hours per hour During March, the company purchased direct materials at a cost of $45,240, all of which were used in the production of 2,400 units of product. In addition, 4,900 direct labor-hours were worked on the product during the month. The cost of this labor time was $39 200 The following variances have been computed for the month Materiais quant lty varlance LAbCLe 1 For direct materials a. Compute the actual cost per foot of materials for March b Compute the price variance and the spending variance 2. For dieect labor a Compute the standard direct labor rabe per hour b. Compute the standard hours allowed for the month's production c Compute the standard hours allowed per unit of product tabs below. Complete this question by entering your answers in the Req SA Req 18 Req 2 sound your answer to theaest il edisane vare) month's production compute the standand heuet 2c. For direct labor, compute the standard hours 2a. For direct labor, compute the standard direct labor rate per thour not round your For direct labor, compute the standard hours allowed for MacBook Air s10Explanation / Answer
Labor rate variance =labor spending variance -labor efficiency variance
= 3200 -750
= 2450 U
Labor rate variance =Actual cost -[AH SR]
2450 = 39200 - [4900 *SR]
4900SR = 39200-2450
SR= 36750/4900 =$ 7.5 PER HOUR [Rounded to 8 ]
2)labor efficiency variance =SR [AH-SH]
750 = 8 [4900 -SH]
750/8 = 4900-SH
SH = 4900-93.75
= 4806.25 HOurs
2c)Hours per unit : hOurs / number of units produced
= 4806.25/ 2400
= 2 per hour
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