Extra Practice on Variance Analysis

The following information will help you to assist in evaluating the performance of Metals, Inc.:

Actual Costs:

Direct Materials purchased and used $188,700(102,000 pounds)

Direct Labor$140,000(10,700 hours)

Manufacturing OH $204,000(61% is variable)

Standard Costs Per Unit:

Direct materials $ 1.65 x 5 pounds per unit of output

Direct labor $14.00 per hr x hour to make each unit

Variable OH $11.90 per direct labor hour

Production Budget:

Direct material$165,000

Direct Labor$140,000

Manufacturing OH$199,000

Variable OH is applied based on Direct labor hours.The company's actual production was 21,000 units.

Prepare the direct materials price and quantity variances, direct labor rate and efficiency variances, variable OH spending and efficiency variances, and the fixed overhead spending and volume variances.