Direct Materials, Direct Labor, and Factory Overhead Cost Variance Analysis

Santiago Inc. processes a base chemical into plastic. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of $74,000$ units of product were as follows:

$\backslash$table$[[,$Standard Costs,Actual Costs$],[$Direct materials,$236,800lbs.$ at $$4\mathrm{.}80$ per lb$.,234,400$ lbs$.$ at $$4\mathrm{.}60$ per Ib$.],[$Direct labor,$18,500$ hrs$.$ at $$17\mathrm{.}70$ per hr$.,18,930$ hrs$.$ at $$18\mathrm{.}10$ per hr$.],[$Factory overhead,$\backslash$table$[[$Rates per direct labor hr$.,$ based on $100\%$ of normal$],[$capacity of $19,310$ direct labor hrs$.$:$]],],[,$Variable cost, $$4\mathrm{.}00,$$$73,260$ variable cost$],[,$Fixed cost, $$6\mathrm{.}30,$$$121,653$ fixed cost$]]$

Each unit requires $0\mathrm{.}25$ hour of direct labor.

Required:

a$.$ Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Direct Materials Price Variance

Direct Materials Quantity Variance

Total Direct Materials Cost Variance

$

$

$

$$

$$

$$

b$.$ Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Required: positive number.

Direct Materials Price Variance

Direct Materials Quantity Variance

Total Direct Materials Cost Variance

$$

$ $$

$

$$

$$

Direct Labor Rate Variance

Direct Labor Time Variance

Total Direct Labor Cost Variance unfavorable variance as a positive number.

Variable factory overhead controllable variance

Fixed factory overhead volume variance

Total factory overhead cost variance

$ $$

$ $$

$ $$

$$

$$

$$

Direct Materials, Direct Labor, and Factory Overhead Cost Variance Analysis

Santiago Inc. processes a base chemical into plastic. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of $74,000$ units of product were as follows:

$\backslash$table$[[$Standard Costs,Actual Costs$],[$Direct materials,$236,800$Ibs. at $$4\mathrm{.}80$ per $lb.,234,400lbs.$ at $$4\mathrm{.}60$ per lb$.],[$Direct labor,$18,500$ hrs$.$ at $$17\mathrm{.}70$ per hr$.,18,930hrs.$ at $$18\mathrm{.}10$ per hr$.],[$Ractory overhead,capacity of $19,310$ direct labor hrs$.$:$,],[,$Variable cost, $$4\mathrm{.}00,$$$73,260$ variable cost$],[,$Fixed cost, $$6\mathrm{.}30,$$$121,653$ fixed cost$]]$

Each unit requires $0\mathrm{.}25$ hour of direct labor.

Required: positive number.

Direct Materials Price Variance

Direct Materials Quantity Variance

Total Direct Materials Cost Variance

Direct Labor Rate Variance