Sharp Company manufactures a product for which the following standards have been set: Standard Quantity or Hours
Question:
Sharp Company manufactures a product for which the following standards have been set: |
Standard Quantity or Hours | Standard Price or Rate | Standard Cost | ||||||
Direct materials | 3 | feet | $ | 5 | per foot | $ | 15 | |
Direct labor | ? | hours | ? | per hour | ? | |||
During March, the company purchased direct materials at a cost of $44,100, all of which were used in the production of 2,350 units of product. In addition, 4,800 hours of direct labor time were worked on the product during the month. The cost of this labor time was $40,800. The following variances have been computed for the month: |
Materials quantity variance | $ | 1,500 | U | ||||||||||||||
Labor spending variance | $ | 3,200 | U | ||||||||||||||
Labor efficiency variance | $ | 800 | U | ||||||||||||||
|
Financial and Managerial Accounting
ISBN: 978-0538480895
11th Edition
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren