Answer:
Instructions are listed below.
Explanation:
Giving the following information:
During June, Danby Company’s material purchases amounted to 6,800 pounds for $8.10 per pound. Costs incurred in the production of 2,400 units.
The standards for one unit of Danby Company’s product are as follows: 2 pounds per unit, $7.80 per pound.
Direct material price variance= (standard price - actual price)*actual quantity
Direct material price variance= (7.8 - 8.1)*6,800= $2,040 unfavorable
Direct material quantity variance= (standard quantity - actual quantity)*standard price
Standard quantity= 2,400 units*2 pounds= 4,800 punds
Actual quantity= 40,500/8.10= 5000 pounds
Direct material quantity variance= (4,800 - 5,000)*7.8= $1,560 unfavorable
Purchase variance= 7.80 - 8.10= $0.30 unfavorable
Standard labor costs:
Direct labor: $ 137,025 ($18.90 per hour); 2,400 units.
Actual:
3 hours per unit; $18.80 per hour.
Direct labor efficiency variance= (SQ - AQ)*standard rate
Direct labor efficiency variance= (7,200 - 7,250)*18.80= $940 unfavorable
Direct labor price variance= (SR - AR)*AQ
Direct labor price variance= (18.80 - 18.90)*7,250= $725 unfavorable
