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    Direct Material & Labour Variances

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    Quicksand Company has set the following standards for one unit of product:

    Direct material
    Quantity: 6.2 pounds per unit
    Price per pound: $11 per pound
    Direct labor
    Quantity: 6 hours per unit
    Rate per hour: $23 per hour

    Actual costs incurred in the production of 2,800 units were as follows:

    Direct material: $194,350 ($11.50 per pound)
    Direct labor: $393,750 ($22.50 per hour)

    All materials purchased were consumed during the period.

    Calculate the direct-material price and quantity variances and the direct-labor rate and efficiency variances. Indicate whether each variance is favorable or unfavorable.

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    Direct Material Price Variances = (Standard Cost - Actual Cost) * Actual Quantity
    Direct Material Quantity Variances = (Standard Quantity - Actual Quantity) * Standard ...

    Solution Summary

    The solution computes Direct Material & Labour Variances (price, uage, efficiency, rate) for Quicksand Company and provides formula.