please give answers to parts 1-6 Case 23.2 Boxes Company has collected the follo
ID: 2599146 • Letter: P
Question
please give answers to parts 1-6
Case 23.2 Boxes Company has collected the following data for one of its products: Direct materials standard (3 pounds @ $1/1b.) Direct materials flexible budget variance-unfavorable Actual direct materials used $3 per finished good $14,000 100,000 pounds 25,000 units Actual finished goods produced 1) Refer to Case 23.2. What is the total actual cost of the direct materials used? 2) Refer to Case 23.2. What is the actual cost of the direct materials used per pound? 3) Refer to Case 23.2. How much is the direct materials efficiency variance? 4) Refer to Case 23.2. How much is the direct materials price variance? 5) Jennifer Gibson Company budgeted 4,000 pounds of direct materials costing $7.00 per pound to make 8,000 units of product. The company actually used 4,200 pounds costing $6.50 per pound to make the 8,000 units. What is the direct materials efficiency variance? 6) Professional Woodworkers budgeted 3 hours of direct labor per unit at $8.50 per hour to produce 400 units of product. The 400 units were completed using 1,140 hours at $8.75 per hour. What is the direct labor price variance?Explanation / Answer
Case 23.2
Boxes Company:
1. Actual cost of direct materials used = $ 3 x 25,000 + $ 14,000 = $ 89,000.
2. Actual cost of direct materials per pound = $ 89,000 / 100,000 pounds = $ 0.89.
3. Direct materials efficiency variance = ( 3 lbs x 25,000 - 100,000) x $ 1 = $ 25,000 Unfavorable.
4. Direct materials price variance = $ ( 1.00 - 0.89) x 100,000 = $ 11,000 Favorable.
5. Jennifer Gibson Company :
Direct material efficiency variance = (Standard quantity allowed for Actual Output - Actual Quantity Used) x Standard cost per unit = ( 4,000 - 4,200) x $ 7.00 = $ 1,400 Unfavorable.
6. Professional Woodworkers :
Direct labor price variance = ( Standard labor hour rate - Actual labor hour rate ) x Actual Hours Used = $ ( 8.50 - $ 8.75) x 1,140 = $ 285 Unfavorable
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