Question

Actual labor rate $16 per hour Actual materials price $160 per ton Standard labor rate $15.50 per hour Standard materials price $163 per ton Quantities Actual hours incurred and used 5,000 hours Actual quantity of materials purchased and used 1,700 tons Standard hours used 5,040 hours Standard quantity of materials used 1,675 tons (a) Compute the total, price, and quantity variances for materials and labor. Total materials variance $enter a dollar amount select an option Materials price variance $enter a dollar amount select an option Materials quantity variance $enter a dollar amount select an option Total labor variance $enter a dollar amount select an option Labor price variance $enter a dollar amount select an option Labor quantity variance

Answer 1

Materials price variance $5,100 F

Materials quantity variance $4,075 U

Total labor variance $2,500 U

Labor price variance $620 F

Step-by-step explanation:

a) Data and Calculations:

Actual Standard

Labor rate per hour $16 $15.50

Material price per ton $160 $163

Labor hours 5,000 5,040

Materials 1,700 1,675

a) Total price variance for materials = Standard price per ton - Actual price per ton * Actual materials

= $163 - $160 * 1,700

= $5,100 F

b) Total quantity variance for materials = Standard quantity - Actual quantity * Standard price

= 1,675 - 1,700 * $163

= 25 * $163

= $4,075 U

c) Total price variance for labor = Standard rate per hour - Actual rate per hour * Actual labor hours

= $15.50 - $16 * 5,000

= -$0.50 * 5,000

= $2,500 U

d) Total quantity variance for labor = Standard labor hours - Actual labor hours * Standard rate

= 5,040 - 5,000 * $15.50

= $620 F