Shasta Fixture Company manufactures faucets in a small manufacturing facility. The faucets are made from brass. Manufacturing
Question:
Shasta Fixture Company manufactures faucets in a small manufacturing facility. The faucets are made from brass. Manufacturing has 70 employees. Each employee presently provides 38 hours of labor per week. Information about a production week is as follows:
Standard wage per hr. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $20.00
Standard labor time per faucet. . . . . . . . . . . . . . . . . . . . . . . . . . . 30 min.
Standard number of lbs. of brass. . . . . . . . . . . . . . . . . . . . . . 2.5 lbs.
Standard price per lb. of brass. . . . . . . . . . . . . . . . . . . . . . . . . . . . $1.80
Actual price per lb. of brass. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1.95
Actual lbs. of brass used during the week. . . . . . . . . . . . . . . . . .13,000 lbs.
Number of faucets produced during the week. . . . . . . . . . . . . . . 5,000
Actual wage per hr. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $18.75
Actual hrs. for the week (70 employees × 38 hours). . . . . . . . . . . 2,660
Instructions
Determine
(a) The standard cost per unit for direct materials and direct labor;
(b) The direct materials price variance, direct materials quantity variance, and total direct materials cost variance; and
(c) The direct labor rate variance, direct labor time variance, and total direct labor cost variance.
Step by Step Answer:
Forensic And Investigative Accounting
ISBN: 9780808056300
10th Edition
Authors: G. Stevenson Smith D. Larry Crumbley, Edmund D. Fenton