104. In early 2012, Duncan Manufacturing Inc. had budgeted for the production and sale of 20,000 units at a sales price of $25 per unit. The following information is available regarding the standard cost for each unit:
Direct materials:
$6.00 (3 pounds at $2.00 per lb)
Direct labor:
$3.50 (10 minutes of assembly at $.35 per minute)
Actual results for 2012 were determined to be as follows:
Number of units produced
and sold:
18,000 units
Sales revenue:
$477,000 ($26.5 per unit)
Direct materials cost:
$119,925 (58,500 lbs purchased and used at $2.05 per lb)
Direct labor cost:
$51,300 (171,000 minutes at $.30 per minute)
Required: Compute each of the following variances. Indicate whether the variance is favorable (F) or unfavorable (U).
A.
Sales price variance
B.
Direct materials price variance
C.
Direct materials usage variance
D.
Direct labor rate variance
E.
Direct labor efficiency variance
105. Kincaid Ltd. produces and sells leather wallets. In the current year, the company budgeted for the production and sale of 18,000 wallets; however, 21,000 wallets were actually produced and sold. Each wallet has a standard requiring eight square inches of material at a cost of .20 per inch and ten minutes of assembly time at a cost of $.15 per minute. Actual costs for the production of 21,000 wallets were $36,080 for materials (164,000 inches purchased and used @ $.22 per inch) and $36,000 for labor (225,000 minutes @ $.16 per minute).Required: Compute each of the following variances. Indicate whether the variance is favorable (F) or unfavorable (U).
A.
Direct materials price variance
B.
Direct materials usage variance
C.
Direct labor rate variance
D.
Direct labor efficiency variance
106. Gemma Products produces and sells a variety of domestic goods including sheets. In the current year, the company budgeted for the production and sale of 10,000 sets; however, 12,000 sets were actually produced and sold. Each set has a standard requiring 10 yards of material at a cost of $1.10 per yard and 20 minutes of direct labor (for sewing, assembly, and inspection) at a cost of $.20 per minute. Actual costs for the production of 12,000 sets were $138,240 for materials (128,000 yards purchased and used @ $1.08 per yard) and $55,200 for labor (230,000 minutes @ $.24 per minute).Required: Compute each of the following variances. Indicate whether the variance is favorable (F) or unfavorable (U).
A.
Direct materials price variance
B.
Direct materials usage variance
C.
Direct labor rate variance
D.
Direct labor efficiency variance
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