Mannerist Statuary manufactures bronze bust statues of famous historical figures. All statues are the same size. Each unit requires the same amount of resources. For 2015, the standard quantities, standard prices, and standard unit costs for direct materials and direct manufacturing labour follow.

During 2015, the actual number of units produced and sold was 5,000. Actual cost of direct materials used was $700,000, based on 56,000 kilograms purchased at $12.50 per kilogram. Direct manufacturing labour hours were 25,000, at the rate of $38 per hour. This resulted in actual direct manufacturing labour costs of $950,000. Actual fixed costs were $1,000,000. There was no beginning or ending inventory.
Required:
1. Calculate
(a) The materials price variance,
(b) The materials efficiency variance,
(c) Assess the manager's performance.
2. Calculate
(a) The labour rate variance,
(b) The labour efficiency variance,
(c) Assess the manager's performance.
3. Record journal entries for
(a) The purchase of materials,
(b) The issuance and usage of mate- rials,
(c) The accrual for labour.
4. For simplicity, assume all of the variances are immaterial (though, they certainly are not).
(a) Record the journal entries for the disposition of the variances,
(b) Assess the manager's performance

Transcribed Image Text:

Standard Quantity 13 kg Standard Price Standard Unit Cost Direct materials Direct manufacturing labour S11/kg $35/hour $143.00 $192.50 5.5 hours