Solution-Compute cost and efficiency variances for direct

Compute cost and efficiency variances for direct materials

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Reference no: EM131750969

Question - Smart Hearing manufacturing headphone cases. During September 2016, the company produced and sold 108,000 cases and recorded the following cost data:

Standard Cost Information
	Quantity	Cost
Direct Materials	2 parts	$0.16 per part
Direct Labor	0.02 hours	8.00 per hour
Variable Manufacturing Overhead	0.02 hours	9.00 per hour
Fixed Manufacturing Overhead ($33,320 for static budget volume of 98,000 units and 1,960 hours, or $17 per hour)

Actual Cost Information
Direct Materials	(212,000 parts @ $2.21 per part)	$44,520
Direct Labor	(1,660 hours @ $8.15 per hour)	13,529
Variable Manufacturing Overhead		8,000
Fixed Manufacturing Overhead		31,000

Requirements -

1) Compute the cost and efficiency variances for direct materials and direct labor.

2) For manufacturing overhead, compute the variable overhead cost and efficiency variances and the fixed overhead cost and volume variances.

Reference no: EM131750969

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Compute cost and efficiency variances for direct materials

Reference no: EM131750969

Reference no: EM131750969

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