| | 29 of 49 (0 complete) ? ? his Test: 150 pts p This Question: 10 pts | Goldma
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| | 29 of 49 (0 complete) ? ? his Test: 150 pts p This Question: 10 pts | Goldman Company manufactures shirts. During June, Goldman made 1,800 shirts and gathered the following additional data ?(Click on the icon to view the data.) Read the requirements 7. Calculate the direct materials cost variance. Select the formula, then enter the amounts and compute the cost variance for direct materials and identify whether the variance is favorable (F) or unfavorable (U) Direct Materials Cost = Variance 8. Calculate the direct materials efficiency variance. Select the formula, then enter the amounts and compute the efficiency variance for direct materials and identify whether the variance is favorable (F) or unfavorable (U) Direct Materials Efficiency - VarianceExplanation / Answer
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7. Direct Material Cost Variance = (Standard Price - Actual Price) * Actual Quantity = [12 - (39772/3260)] * 3260 = 652 (Unfavourable).
8 Direct Material Efficiency Variance = (Standard Quantity - Actual Quantity) * Standard Price = [(1.9*1800) - 3260] * 12 = 1920 ( Favourable)
9. Total Direct Material Variance = DMCV + DMEV = (652) + 1920 = 1268 ( Favourable)
10. Direct Labor Cost Variance = (Standard Rate - Actual Rate) * Actual Hours = [14 - (74392/5470)] * 5470 = 2188 (Favourable)
11. Direct Labor Efficiency Variance = (Standard Hour - Actual Hour) * Standard Rate = [(3*1800) - 5470] * 14 = 980 (Unfavourable)
12. Total Direct Labor Variance = DLCV + DLEV = 2188 + (980) = 1208 (Favourable)
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