INSTRUCTIONS :

For part a. Prepare a matrix and calculate the materials variances, see E11-7 in the Chapter 11 Introduction Module..

For part b. Think about this part and jot down your ideas.

E11.13 (LO 2, 3), AP Ceelo Company purchased (at a cost of $10,200) and used 2,400 pounds of materials during May. Ceelo's standard cost of materials per unit produced is based on 2 pounds per unit at a cost $5 per pound. Production in May was 1,050 units.

Compute variances for materials.

Instructions

a. Compute the total, price, and quantity variances for materials. b. Assume Ceelo also had an unfavorable labor quantity variance. What is a possible scenario that would provide one cause for the variances computed in (a) and the unfavorable labor quantity variance?

E11.7 (LO 2, 3), AP Levine Inc., which produces a single product, has prepared the following standard cost sheet for one unit of the product.

Compute materials and labor variances.

Direct materials (8 pounds at $2.50 per pound) $20

Direct labor (3 hours at $12.00 per hour) $36

During the month of April, the company manufactures 230 units and incurs the following actual costs.

Direct materials purchased and used (1,900 pounds) $5,035

Direct labor (700 hours) $8,120

Instructions Compute the total, price, and quantity variances for materials and labor.