DATA INPUT
Quantity 0.25 hour Quantity 4 kilograms
Rate 12.00$ per hour Price 0.60$ per kilogram
Actual data:
Material purchases 240,000 kilograms
Price 0.62$ per kilogram
Actual costs incurred in the production of: 50,000 units were as follows:
Direct labor: 158,600$ for 13,000 hours
Direct material: 130,200$ for 210,000 kilograms
SOLUTION
1. Direct-material price variance = AQ x (AP – SP)
=210,000 x 0.62$ – 0.60$
Direct-material purchase price variance = PQ x (AP – SP)
=240,000 x 0.62$ – 0.60$
Direct-labor rate variance = AH x (AR* – SR)
Direct-labor efficiency variance = SR x (AH – SH*)
Standard Direct labor:
Standard Direct material:
Direct-material quantity variance = SP x (AQ – SQ*)