Question

Great Fender, which uses a standard cost accounting system, manufactured 20,000 boat fenders during 2014, using 144,000 square feet of extruded vinyl purchased at $ 1.05 per square foot. Production required 420 direct labor hours that cost $ 13.50 per hour. The direct materials standard was 7 square feet of vinyl per fender, at a standard cost of $ 1.10 per square foot. The labor standard was 0.025 direct labor hour per fender, at a standard cost of $ 12.50 per hour.
Compute the cost and efficiency variances for direct materials and direct labor. Does the pattern of variances suggest Great Fender’s managers have been making trade- offs? Explain.



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  • CreatedJanuary 16, 2015
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