Question

v2-Page 5 rs on the space provided. (6 pts. each, except where indicated) the s. Write your answers Products Inc. produces a number of products, including handmade large Pumana Sprouters for outdoor displays. The firm, which began operations at the beginning of l fbeglass plant adard cost system. Each planter requires 3 pounds of material at $6 hecent yean urs of direct labor at $12 per direct labor hour. Estimated monthly poind, undume is 3,000 units. For November, the company produced 3,100 units at the Pomona following costs below Direct materials (10,000 lbs.) Direct labor (6,500 hrs.) Total variable production costs incurred S 55,430 84,500 S139,930 Compute the following variances and label as Favorable (F) or Unfavorable (U). Materials Price Variance Labor Rate Variance Materials Usage Variance Labor Efficiency Variance

Answer 1

Pomona Sprouts Products Inc Material Price Varaince Actual Quantity (Actual price - Std. Price) - 10000 x (5.54- 6) $4600 F Material Usage Variance Std. PricActual Quantity - Std. Quantity) 6x (10000-3x3 $6000 U 000) Labour Rate Variance Actual Hours x(Actual Rate - Std. Rate) 6500 x ( 13 -12) $6500 U Labour Efficiency Variance Std Ratex(Actual Hours- Std. Hours) 12 x ( 6500- 6000) $6000 U