ACCOUNTING-E9-13 Determining Actual Costs, Standard Costs, and Variances [LO 9-3, 9-4]
by ella | Aug 20, 2025 | Business
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E9-13 Determining Actual Costs, Standard Costs, and Variances [LO 9-3, 9-4]
| Amber Company produces iron table and chair sets. During October, Amber’s costs were as follows: |
|
| Actual purchase price |
$ 2.30 |
per lb. |
| Actual direct labor rate |
$ 7.50 |
per hour |
| Standard purchase price |
$ 2.10 |
per lb. |
| Standard quantity for sets produced |
970,000 |
lbs. |
| Standard direct labor hours allowed |
11,000 |
|
| Actual quantity purchased in October |
1,115,000 |
lbs. |
| Actual direct labor hours |
10,000 |
|
| Actual quantity used in October |
1,000,000 |
lbs. |
| Direct labor rate variance |
$5,500 |
F |
|
| 1. |
Calculate the total cost of purchases for October. |
| 2. |
Compute the direct materials price variance based on quantity purchased. (Indicate the effect of each variance by selecting “F” for favorable, “U” for unfavorable.)
|
| 3. |
Calculate the direct materials quantity variance based on quantity used. (Indicate the effect of each variance by selecting “F” for favorable, “U” for unfavorable.)
|
| 4. |
Compute the standard direct labor rate for October. (Round your answer to 2 decimal places.)
|
| 5. |
Compute the direct labor efficiency variance for October. (Indicate the effect of each variance by selecting “F” for favorable, “U” for unfavorable.)
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