Ask Question
24 April, 02:01

Levine Inc., which produces a single product, has prepared the following standard cost sheet for one unit of the product. Direct materials (8 pounds at $3.90 per pound) $31.20 Direct labor (5 hours at $14.00 per hour) $70.00 During the month of April, the company manufactures 270 units and incurs the following actual costs. Direct materials purchased and used (2,100 pounds) $8,400 Direct labor (1,390 hours) $19,182 Compute the total, price, and quantity variances for materials and labor.

+3
Answers (1)
  1. 24 April, 03:50
    0
    Standard material quantity allowed = 270 units * 8 pounds

    = 2,160

    Material Price variance = Actual Quantity (Standard price - Actual price)

    = 2,100 (3.90 - 4.00)

    = 210 Unfavorable

    Material Qty variance = Standard price (Standard quantity - Actual quantity)

    = 3.90 (2,160 - 2,100)

    = 234 Favorable

    Total Material Variance:

    = (Standard quantity * Standard price) - (Actual Quantity * Actual price)

    = (2,160 * 3.90) - (2,100 * 4)

    = 24 Favorable

    Labour rate variance = Actual hours (Standard rate - Actual rate)

    = 1390 (14 - 13.80)

    = 278 Favorable

    Labor efficiency variance = Standard rate (Standard hours-Actual hours)

    = 14 (1350 - 1390)

    = 560 Unfavorable

    Total Labour cost variance:

    = (Standard hours * Standard rate) - (Actual Hours * Actual rate)

    = (1350 * 14) - (1390 * 13.80)

    = 282 Unfavorable
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Levine Inc., which produces a single product, has prepared the following standard cost sheet for one unit of the product. Direct materials ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers