Direct Materials and Direct Labor Variance AnalysisShasta Fixture Company manufactures faucets in a small manufacturing facility. The faucets are made from brass. Manufacturing has 70 employees. Each employee presently provides 32 hours of labor per week. Information about a production week is as follows:Standard wage per hour$15.60Standard labor time per unit20 min.Standard number of lbs. of brass1.2 lbs.Standard price per lb. of brass$13.00Actual price per lb. of brass$13.25Actual lbs. of brass used during the week11,124 lbs.Number of units produced during the week9,000Actual wage per hour$16.07Actual hours for the week (70 employees × 32 hours)2,240Required:a. Determine the standard cost per unit for direct materials and direct labor. Round the cost per unit to two decimal places.Direct materials standard cost per unit$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 the nearest whole dollar. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.Direct Materials Price Variance$ Direct Materials Quantity Variance$ Total Direct Materials Cost Variance$ c. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Round your answers to the nearest whole dollar. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.Direct Labor Rate Variance$ Direct Labor Time Variance$ Total Direct Labor Cost Variance$

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Asked Nov 19, 2019
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Direct Materials and Direct Labor Variance Analysis

Shasta Fixture Company manufactures faucets in a small manufacturing facility. The faucets are made from brass. Manufacturing has 70 employees. Each employee presently provides 32 hours of labor per week. Information about a production week is as follows:

Standard wage per hour $15.60
Standard labor time per unit 20 min.
Standard number of lbs. of brass 1.2 lbs.
Standard price per lb. of brass $13.00
Actual price per lb. of brass $13.25
Actual lbs. of brass used during the week 11,124 lbs.
Number of units produced during the week 9,000
Actual wage per hour $16.07
Actual hours for the week (70 employees × 32 hours) 2,240

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 the nearest whole dollar. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Direct Materials Price Variance $  
Direct Materials Quantity Variance $  
Total Direct Materials Cost Variance $  

c. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Round your answers to the nearest whole dollar. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Direct Labor Rate Variance $  
Direct Labor Time Variance $  
Total Direct Labor Cost Variance $  
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a Standard labor time per unit in hours 20 /60 1/3 hours Direct materials standard cost per unit Standard number of Ibs. of brass x Standard price per Ib. of brass 1.2 x $13.00) Direct labor standard cost per unit Standard labor time per unit in hours x Standard wage per hour (1/3) x 15.60) Total standard cost per unit $15.60 $5.20 $20.80

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$2,781.00 Unfavorable b. Direct materials price variance (Actual price Standard price) x Actual quantity (13.25-13.00) x 11,124 Standard quantity of direct materials for actual production Number of units produced during the week x Standard mumber of Ibs. of brass 9000 x 1.2 $10,800.00 $4.212.00 Unfavorable Direct materials quantity variance (Actual quantity Standard quantity) x Standard price (11,124 10800) x 13.00 Total direct materials cost variance (Actual quantity x Actual price) (Standard quantity x Standard price) ( 11,124 x 13.25)-(10800 x 13.00) $6,993.00 Unfavorable s1,052.80 Unfavorable Direct labor rate variance (Actual rate Standard rate) x Actual hours (16.07 15.60) x 2240 Standard hours for actual production Number of units produced during the week x Standard labor hours per unit 9000 x (1/3) $3,000.00 $11,856.00 Favorable Direct labor time variance (Actual hours Standard hours) x Standard rate (2240 3000) x 15.60 $10,803.20 Favorable Total direct labor cost variance (Actual hours x Actual rate) (Standard hours x Standard rate) - (2240 x 16.07)-(3000 x 15.60)

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