Question

Barley Hopp, Inc., manufactures custom-ordered commemorative beer steins. Its standard cost Information follows: Standard Standard Price Standard Quantity 1.7e lbs 1.7e hrs (Rate) 1.80 per 1b $13.00 per hr. Unit Cost Direct materials (clay) 3.06 Direct labor 22.10 Variable manufacturing overhead (based on direct labor hours) 1.7e hrs 1.1 per hr. 1.87 Fixed manufacturing overhead ($276,eee.ee 120, eee.ee units) 2.30 Barley Hopp had the following actual results last year Number of units produced and sold Number of pounds of clay used Cost of clay 125, eee 218, 20e 37e,940 17e, eee $2,805, eee Number of labor hours worked Direct labor cost Variable overhead cost 240, eee Fixed overhead cost 30e, eee Required: 1. Calculate the direct materlals price, quantity, and total spending varlances for Barley Hopp. 2. Calculate the direct labor rate, efficiency, and total spending variances for Barley Hopp 3. Calculate the variable overhead rate, efficiency, and total spending variances for Barley Hopp.

Answer 1

1)
	direct material price variance
	(Actua price - standard price)*aqpurchased
	(370940 - 218200*1.8)
	21,820	F
	direct material qty variance
	(AQ used - standard qty allowed)*standard rate
	(2181200 - 125000*1.7)*1.8
	10260	U
	direct materials spending variance
	11,560	F
2)	direct labor rate variance
	(Actual price - standard rate )*ah
	(2,805,000-170000*13)
	595000	U
	direct labor efficiency vriance
	(AH - SG)*standard rate
	(170000 -125000*1.7)*13
	552,500	F
	direct labor spending variance
	42500	U
3)
	variable overhead rate
	(Actual price - standard rate )*ah
	(240000-170000*1.1)
	53000	U
	variable overhead efficiecny variance
	(AH - SG)*standard rate
	(170000-125000*1.7)*1.1
	46,750	F
	Variable overhead spending variance
	6,250	U