TOY FACTORY is a manufacturer of toys for international supply. The standard costs for 1 unit...

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TOY FACTORY is a manufacturer of toys for international supply. The standard costs for 1 unit of toy is as follows: Direct materials (2 kg @ $9.00/kg) $ 18.00 Direct labour (6 hrs @ $12.00/hr) 72.00 Variable overhead (6 DLH @ $20.00/ DLH) 120.00 Actual results for the last quarter were: Actual output 25,000 units Direct materials (purchased and used 55,000 kg) $ 506,000 Direct labour (185,000 hrs worked) 2,331,000 Variable overhead 3,330,000 Required: (a) Calculate the following variances: (i) Direct material price, quantity and total variances (ii) Direct labour price, quantity and total variances (iii) Variable overhead spending, efficiency and total variance TOY FACTORY is a manufacturer of toys for international supply. The standard costs for 1 unit of toy is as follows: Direct materials (2 kg @ $9.00/kg) $ 18.00 Direct labour (6 hrs @ $12.00/hr) 72.00 Variable overhead (6 DLH @ $20.00/ DLH) 120.00 Actual results for the last quarter were: Actual output 25,000 units Direct materials (purchased and used 55,000 kg) $ 506,000 Direct labour (185,000 hrs worked) 2,331,000 Variable overhead 3,330,000 Required: (a) Calculate the following variances: (i) Direct material price, quantity and total variances (ii) Direct labour price, quantity and total variances (iii) Variable overhead spending, efficiency and total variance

Answer rating: 100% (QA)

Answer To calculate the variances we need to compare the actual costs with the standard costs for the actual output Lets calculate each variance stepb... View the full answer