Question

Bramble Inc., which produces a single product, has prepared the following standard cost sheet for one unit of the product. Direct materials (6 pounds at $3.10 per pound) $18.60 Direct labor (4 hours at $10.00 per hour) $40.00 During the month of April, the company manufactures 190 units and incurs the following actual costs. Direct materials purchased and used (2,200 pounds) $7,260 Direct labor (770 hours) $7,623 Compute the total, price, and quantity variances for materials and labor. Total materials variance $ Materials price variance $ Materials quantity variance $ Total labor variance $ Labor price variance $ Labor quantity variance $ Click if you would like to Show Work for this question: Open Show Work LINK TO TEXT LINK TO TEXT

Answer 1

Answer and Explanation:

a. The computation of the material price variance is shown below:

= Actual Quantity × (Standard Price - Actual Price)

= $7,260 × (2,200 pounds × $3.10 per pound)

= $440 unfavorable

b. The computation of the material quantity variance is shown below:

= Standard Price × (Standard Quantity - Actual Quantity)

= $3.10 × (2,200 pounds - (190 units × 6 pounds))

= $3,286 unfavorable

c. Total material variance

= Material price variance + material quantity variance

= $440 unfavorable + $3,286 unfavorable

= $3,726 unfavorable

d. The computation of the labor price variance is shown below:

= Actual Hours × (Actual price - Standard Price)

= $7,623 - (770 hours × $10)

= $77 favorable

e. The computation of the labor quantity variance is shown below:

= Standard Rate × (Actual Hours - Standard hours allowed for actual units)

= $10 × (770 hours - (190 units × 4 hours)

= $100 unfavorable

Total labor variance

= Labor rate variance + labor quantity variance

= $77 favorable + 100 unfavorable

= $23 unfavorable