Morro Bay Surfboards manufactures fiberglass surfboards. The standard cost of direct materials and direct manufacturing labor is

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Morro Bay Surfboards manufactures fiberglass surfboards. The standard cost of direct materials and direct manufacturing labor is $225 per board. This includes 30 pounds of direct materials, at the budgeted price of $3 per pound, and 9 hours of direct manufacturing labor, at the budgeted rate of $15 per hour. Following are additional data for the month of July:

Units completed 5,500 units

Direct material purchases 190,000 pounds

Cost of direct material purchases $579,500

Actual direct manufacturing labor-hours 49,000 hours

Actual direct labor cost $739,900

Direct materials efficiency variance $ 1,500 F


There were no beginning inventories.

REQUIRED

1. Compute direct manufacturing labor variances for July.

2. Compute the actual pounds of direct materials used in production in July.

3. Calculate the actual price per pound of direct materials purchased.

4. Calculate the direct materials price variance.


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Cost Accounting A Managerial Emphasis

ISBN: 978-0132109178

14th Edition

Authors: Charles T. Horngren, Srikant M.Dater, George Foster, Madhav

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