The Walthaus Corporation standard cost sheet is as follows: 

Direct material 4 feet at $5.00 per foot 

Direct labor 3 hours at $10.00 per hour 

Variable overhead 3 hours at $2.00 per hour 

Fixed costs 3 hours at $1.00 per hour 

Additional Information: 

Actual Results: 

Purchased 30,000 lbs. of material at $5.25 per pound (there were no beginning or ending inventories of materials); 

The direct labor cost incurred was 26,000 hours at $9.75 per hour; 

Actual variable overhead incurred, $50,000; 

Actual fixed overhead costs incurred $43,000. 

Overhead is applied to work in process on a direct labor-hours basis. 

The company produced 8,000 units of product during the period. 

The number of hours estimated for the calculation of the rate of application of fixed general expenses amounted to 45,000 hours.

 What are the variations in price and material efficiency?

Answer rating: 100% (QA)

To calculate the variations in price and material efficiency we need to compare the standard cost wi... View the full answer