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Elden [556K]
3 years ago
15

Ruby Company produces a chair that requires 7 yards of material per unit. The standard price of one yard of material is $14.40.

During the month, 6,500 chairs were manufactured, using 44,600 yards at a cost of $15.12 per yard. Enter favorable variances as negative numbers. (a) Determine the price variance. $fill in the blank 1 (b) Determine the quantity variance. $fill in the blank 3 (c) Determine the cost variance. $fill in the blank 5
Business
1 answer:
Usimov [2.4K]3 years ago
7 0

Answer:

See below

Explanation:

a. Price variance

= (Actual price - Standard price) × Actual material

= ($15.12 - $14.40) × 44,600

= $0.72 × 44,600

= $32,112 Unfavourable

b. Quantity variance

= (Actual quantity - Standard quantity) × Standard price

= [44,600 - (6,500 × 7) ] × $14.40

= (44,600 - 45,500) × $14.40

= -900 × $14.40

= $12,960 Favourable

C. Cost variance

= Actual cost - Standard cost

= (44,600 × $15.12) - (7 × 6,500 × $14.40)

= $674,352 - $655,200

= $19,152Unfavourable

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The total manufacturing costs for the Job No. 190 is 470,000. To get its direct labor cost, which is the basis of the Henson Company in applying its overhead at the rate of 120%, we need to divide the manufacturing overhead of $180,000 by the rate 120% to get the direct labor cost of 150,000. (180,000/210% = 150,000). To get the total manufacturing cost, you need to add the:direct materials- 140,000direct labor- 150,000manufacturing overhead- 180TOTAL= 470,000- this is the total manufacturing costs (Job No. 190)
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This is further explained below.

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If the Citrus Growers Association grows $1 million worth of oranges, sells $500,000 worth of oranges to consumers, uses the rest
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