Wright, Inc. manufactures a product that has the following standard costs: Direct materials: 30 yards at $4.75...

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Accounting

Wright, Inc. manufactures a product that has the followingstandard costs:
Direct materials: 30 yards at $4.75 peryard                $142.50
Direct labor: 7 hours at $18.00 perhour                      126.00
  Total                                                                          $268.50
The following information pertains to July:
Direct material costs 20,000 yards at $4.50 per yard, or$90,000
(quantity purchased and quantity used are the same).
Direct labor: 4,500 hours at $18.25 per hour, or $82,125
Actual completed production: 650 units
Answer and Show Work:
Calculate the following variances and indicate whethereach variance is favorable or unfavorable using F for favorable andU for unfavorable.
Direct-material price
Direct-material quantity
Direct-labor rate
Direct-labor efficiency

Answer & Explanation Solved by verified expert

3.7 Ratings (605 Votes)

Computation of Material Price and Quantity Variances Given data Standard Price of Direct Material SP 475 Actual Price of Direct Material AP 45 Actual Quantity AQ 20000 yards Standard Quantity SQ for actual output See Answer

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Direct-material price
Direct-material quantity
Direct-labor rate
Direct-labor efficiency