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Question

Digital Boards, Inc. manufactures a product that has the following standard costs:


Direct

materials: 10 sq. mm. at $8.50 per sq. mm.        $85.00

Direct labor: 6 hours at $20.00 per hour                       120.00

  Total                                                                          $208.00


The following information pertains to July:

Direct material costs 10,000 sq. mm. at $9.00 per sq. mm., or $90,000

(quantity purchased and quantity used are the same).

Direct labor: 6,800 hours at $19.00 per hour, or $129,200


Actual completed production: 1,100 units


Required:

Calculate the following variances and indicate whether each variance is favorable or unfavorable using F for favorable and U for unfavorable.


Direct-material price


Direct-material quantity


Direct-labor rate


Direct-labor efficiency


 

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