Question

Hutto Corp. has set the following standard direct materials and direct labor costs per unit for the product it manufactures.
Direct materials (15 lbs. @ $4 per lb.). . . . . . . . . . . . . . . . . . . . .. . . . $60
Direct labor (3 hrs. @ $15 per hr.). . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
During May the company incurred the following actual costs to produce 9,000 units.
Direct materials (138,000 lbs. @ $3.75 per lb.) . . . . . . . . . . . . . $517,500
Direct labor (31,000 hrs. @ $15.10 per hr.). . . . . . . . . . . . . . . . . 468,100
Compute the
(1) Direct materials price and quantity variances
(2) Direct labor rate and efficiency variances. Indicate whether each variance is favorable or unfavorable.


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  • CreatedApril 23, 2015
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