Crystal Charm Company makes handcrafted silver charms that attach to jewelry suc
ID: 2567143 • Letter: C
Question
Crystal Charm Company makes handcrafted silver charms that attach to jewelry such as a necklace or bracelet. Each charm is adorned with two crystals of various colors. Standard costs follow: Quantity Standard (Rate) 0.60 oz. $24.00 per oz 4.00 0.45 per crystal 1.50 hrs. $14.00 per hr Unit Cost Silver Crystals Direct labor S 14.40 1.80 21.00 During the month of January, Crystal Charm made 1,500 charms. The company used 860 ounces of silver (total cost of $21,500) and 6,050 crystals (total cost of $2,601.50), and paid for 2,400 actual direct labor hours (cost of $32,400.00) Required 1. Calculate Crystal Charm's direct materials variances for silver and crystals for the month of January. (Round your intermediate calculations and final answers to 2 decimal places. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable.) Silver Crystals Direct Material Price Variance Direct Material Quantity Variance 2. Calculate Crystal Charm's direct labor variances for the month of January (Round your intermediate calculations and final answers to 2 decimal places.Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable.) Direct Labor Rate Variance Direct Labor Efficiency VarianceExplanation / Answer
Answer to 1
Silver Variances
Crystal Variances
Answer to 2
Direct Material Price Variance = (Standard Rate - Actual Rate) x Actual Quantity = ( 24 - 21500/860) x 860 = 860 Unfav Direct Material Quantity Variance = (Standard Quantity - Actual Quantity) x Standard Rate = ( 1500 x 0.60 - 860) x 24 = 960 FavRelated Questions
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