80.2K

Verified Solution

Link Copied!

Direct Materials and Direct Labor Variance Analysis

Fancy Fixture Company manufactures faucets in a small manufacturing facility. The faucets are made from brass. Manufacturing has 100 employees. Each employee presently provides 40 hours of labor per week. Information about a production week is as follows:

Standard wage per hr.	$21.00
Standard labor time per faucet	20 min.
Standard number of lbs. of brass	5 lbs.
Standard price per lb. of brass	$2.80
Actual price per lb. of brass	$2.72
Actual lbs. of brass used during the week	59,875 lbs.
Number of faucets produced during the week	11,820
Actual wage per hr.	$21.40
Actual hrs. for the week	4,000 hrs.

Required:

a. Determine the standard cost per unit for direct materials and direct labor. Round the cost per unit to two decimal places.

Direct materials standard cost per unit	$
Direct labor standard cost per unit	$
Total standard cost per unit	$

b. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Round your answers to two decimal places, if necessary. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Price variance	$	Favorable
Quantity variance	$	Unfavorable
Total direct materials cost variance	$	Favorable

c. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Rate variance	$	Unfavorable
Time variance	$	Unfavorable
Total direct labor cost variance	$	Unfavorable

Answer & Explanation Solved by verified expert

See Answer