CenterWare is a manufacturer of large flower pots for urban settings. The company has these standards:...

    

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CenterWare is a manufacturer of large flower pots for urban settings. The company has these standards: E (Click the icon to view the standards.) E (Click the icon to view the actual results.) Read the feguirements Requirement 1. Compute the direct labor rate variance and the direct labor efficiency variance. (Enter the variances as positive numbers. Enter the currency amounts in the formulas to the nearest cent, then round the final variance amounts to the nearest whole dollar. Label the variance as favorable (F) or unfavorable (U). Abbreviations used: DL = Direct labor) Begin with the direct labor rate variance. First determine the formula for the rate variance, then compute the rate variance for direct labor. DL rate variance Requirement 2. What is the total variance for direct labor? (Enter the amount as a positive number. Label the variance as favorable (F) or unfavorable (U).) The total variance for direct labor is Requirement 3. Who is generally responsible for each variance? department is responsible for the The department is responsible for the labor rate variance. The labor efficiency variance. Requirement 4. Interpret the variances. The labor rate variance means that Watermate's employees earned per hour than budgeted. labor efficiency variance means that it actually took The direct labor hours than it should have to produce 1,100 pots. 12 pounds per pot at a cost of $3.00 per . pound 5.0 hours at a cost of $19.00 per hour Direct materials (resin). Direct labor..... Standard variable manufacturing overhead rate..... $2.00 per direct labor hour Budgeted fixed manufacturing overhead . $62,000 Standard fixed MOH rate. .$10.00 per direct labor hour (DLH) CenterWare allocated fixed manufacturing overhead to production based on standard direct labor hours. Last month, the company reported the following actual results for the production of 1,300 flower pots: Purchased 16,820 pounds at a cost of $3.10 per pound; ..used 16,120 pounds to produce 1,300 pots Direct materials. . Direct labor...... Worked 5.4 hours per flower pot (7,020 total DLH) at a .. cost of $18.00 per hour Actual variable manufacturing overhead... $2.30 per direct labor hour for total actual variable . manufacturing overhead of $16,146 Actual fixed manufacturing overhead $61,700 Standard fixed manufacturing overhead allocated based on actual production.. $65,000 CenterWare is a manufacturer of large flower pots for urban settings. The company has these standards: E (Click the icon to view the standards.) E (Click the icon to view the actual results.) Read the feguirements Requirement 1. Compute the direct labor rate variance and the direct labor efficiency variance. (Enter the variances as positive numbers. Enter the currency amounts in the formulas to the nearest cent, then round the final variance amounts to the nearest whole dollar. Label the variance as favorable (F) or unfavorable (U). Abbreviations used: DL = Direct labor) Begin with the direct labor rate variance. First determine the formula for the rate variance, then compute the rate variance for direct labor. DL rate variance Requirement 2. What is the total variance for direct labor? (Enter the amount as a positive number. Label the variance as favorable (F) or unfavorable (U).) The total variance for direct labor is Requirement 3. Who is generally responsible for each variance? department is responsible for the The department is responsible for the labor rate variance. The labor efficiency variance. Requirement 4. Interpret the variances. The labor rate variance means that Watermate's employees earned per hour than budgeted. labor efficiency variance means that it actually took The direct labor hours than it should have to produce 1,100 pots. 12 pounds per pot at a cost of $3.00 per . pound 5.0 hours at a cost of $19.00 per hour Direct materials (resin). Direct labor..... Standard variable manufacturing overhead rate..... $2.00 per direct labor hour Budgeted fixed manufacturing overhead . $62,000 Standard fixed MOH rate. .$10.00 per direct labor hour (DLH) CenterWare allocated fixed manufacturing overhead to production based on standard direct labor hours. Last month, the company reported the following actual results for the production of 1,300 flower pots: Purchased 16,820 pounds at a cost of $3.10 per pound; ..used 16,120 pounds to produce 1,300 pots Direct materials. . Direct labor...... Worked 5.4 hours per flower pot (7,020 total DLH) at a .. cost of $18.00 per hour Actual variable manufacturing overhead... $2.30 per direct labor hour for total actual variable . manufacturing overhead of $16,146 Actual fixed manufacturing overhead $61,700 Standard fixed manufacturing overhead allocated based on actual production.. $65,000

Answer rating: 100% (QA)

Solution 1 Calculate Direct Labor Rate variance as below Actual hours x Standard rate Actual r... View the full answer