Question

During June, Danby Company’s material purchases amounted to 15,190 pounds at a price of $6.00 per pound. Actual costs incurred in the production of 2,450 units were as follows:

Direct labor:	$	78,144	($14.80 per hour)
Direct material:	$	75,180	($6.00 per pound)

The standards for one unit of Danby Company’s product are as follows:

Direct Labor:	Direct Material:
Quantity, 2 hours per unit	Quantity, 5 pounds per unit
Rate, $14.50 per hour	Price, $5.80 per pound

Required:
Fill in the amounts in the tables below.

Required 1 Required 2 Required 3 Fill in the amounts in the tables below. (Indicate the effect of each variance by selecting "Favorable" or "Unfavorable". Select "None" and enter "O" for "Actual Price" and "Standard Price" to 2 decimal places.) Actual Material Cost Direct-Material Price and Quantity Variances Projected Material Cost Actual Quantity Standard Price Standard Material Cost Standard Quantity Standard Price Actual Quantity X Actual Price X X х pounds used per pound pounds used per pound pounds allowed per pound $ 0 $ 0 $ 0 Direct-material price variance Direct-material quantity variance Direct-material variance

Answer 1

Direct Material Price & Quantity Variance

Actual Material Cost

Projected Material Cost

Standard Material Cost

Actual Qty

Actual Price

Actual Cost

Actual Qty

Std Price

Projected Cost

Std Qty

STd Price

Std Cost

12530

6

75180

12530

5.8

72674

12250

5.8

71050

Direct Material Price Variance

2506

UnFavourable

Direct Material Qty Variance

1624

Unfavourable

Actual Cost less Projected Cost

Projected Cost less Standard Cost

Direct Material Variance

4130

UnFavourable

Price Variance Add Qty Variance

		Direct Material Purchase Price Variance
Actual Material Cost of Purchase		Projected Material Cost of Purchase
Actual Qty	Actual Price	Actual Cost		Actual Qty	Std Price	Projected Cost
15190	6	91140		15190	5.8	88102
Direct Material Purchase Price Variance	3038	Unfavourable
Actual Cost less Projected Cost

Direct labour Rate & Efficiency Variance

Actual labour Cost

Projected labour Cost

Standard labour Cost

Actual Hours

Actual Rate

Actual Cost

Actual Hours

Std Rate

Projected Cost

Std Hours

Std Rate

Std Cost

5280

14.8

78144

5280

14.5

76560

4900

14.5

71050

Direct labour Rate Variance

1584

Unfavourable

Direct labour Efficiency Variance

5510

Unfavourable

Actual Cost less Projected Cost

Projected Cost less Standard Cost

Direct labour Variance

7094

Unfavourable

Rate Variance Add Efficiency Variance