Reference no: EM132572135

The Monroe corporation manufactures lamps. It has set up the following standards per finished unit for direct materials and direct manufacturing labor.

Direct materials: 10 lb. At Rs 4.50 per lb. Rs. 45.00

Direct manufacturing labor: 0.5 hour at Rs. 30 per hour. 15.00

The number of finished units budgeted for January 2020 was 10,000 ; 9,850 units were actually produced.

Actual results in January 2020 were as follows :

Direct materials : 98055 lb. used

Direct manufacturing labor: 4900 hours Rs. 154,350

Assuming that there I no beginning inventory of finished units.

During the month materials purchased amounted to 100,000 lb. ,at a total cost of Rs. 465,000.

Input price variances are isolated upon purchase . Input-efficiency variances are Isolated at the time of usage .

Required

Question 1. Compute the January 2020 price and efficiency variances of direct materials and direct manufacturing labor.

Question 2. Prepare journal entries to record the variances in requirement 1.

Question 3. Comment on January 2020 price and efficiency variances of Monore corporation.

Question 4. Why might Monore calculate direct materials price variances and direct materials efficiency variances with reference to different points in time ?