San Diego State University Operations And Supply Chain Management Assignment Help - Products

Question - Direct Materials, Direct Labor, and Factory Overhead Cost Variance Analysis
Eastern Polymers, 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 6,800 units of product were as
follows:
Standard Costs Actual Costs
Direct materials 8,800 lbs. at $4.70 8,700 lbs. at $4.50
Direct labor 1,700 hrs. at $17.50 1,740 hrs. at $17.80
Factory overhead Rates per direct labor hr.,
based on 100% of normal
capacity of 1,770 direct
labor hrs.:
Variable cost, $3.50 $5,890 variable cost
Fixed cost, $5.50 $9,735 fixed cost
Each unit requires 0.25 hour of direct labor.
Required:
a. Determine the price variance, quantity v ...Read More ariance, and total direct materials cost variance. Use the minus sign to
enter favorable variances as negative numbers.
Price variance: $ SelectFavorableUnfavorableItem 2
Quantity variance: $ SelectFavorableUnfavorableItem 4
Total direct materials cost variance: $ SelectFavorableUnfavorableItem 6
b. Determine the rate variance, time variance, and total direct labor cost variance. Use the minus sign to enter
favorable variances as negative numbers.
Rate variance: $ SelectFavorableUnfavorableItem 8
Time variance: $ SelectFavorableUnfavorableItem 10
Total direct labor cost variance: $ SelectFavorableUnfavorableItem 12
c. Determine variable factory overheadControllable Variance, the fixed factory overheadvolume variance, and
total factory overhead cost variance. Use the minus sign to enter favorable variances as negative numbers.
Variable factory overhead controllable variance: $ SelectFavorableUnfavorableItem 14
Fixed factory overhead volume variance: $ SelectFavorableUnfavorableItem 16
Total factory overhead cost variance: $ SelectFavorableUnfavorableItem 18 ...Read Less

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