Question

Flat Cups Company produces collapsible beverage containers. The company’s direct materials standards for its 16-ounce beverage bottle include 5 ounces of biodegradable plastic. Standard prices for the year were $0.011 per ounce. Direct labor standards for the beverage bottle specify 0.04 hours of direct labor at a standard direct labor rate of $20 per hour.
During January, the company made 100,000 16-ounce beverage bottles. Actual production data follow.
Direct materials ...... 500,100 ounces @ $0.012 per ounce
Direct labor ........ 3,990 hours @ $20.50 per hour

Required
1. Compute the direct materials price and quantity variances.
2. Compute the direct labor rate and efficiency variances.



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  • CreatedMarch 26, 2014
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