Hernandez Corporation Uses a Standard Cost System and Has Established

question 18

Essay

Hernandez Corporation uses a standard cost system and has established the following standards for one unit of product: During October, the company purchased 240,000 pounds of material at a total cost of $588,000. The total factory wages for October were $49,400. During October, 21,000 units of product were manufactured using 211,000 pounds of material and 5,200 direct labor hours. Material quantity and price variances are recorded when materials are used.
a.Compute the material quantity and labor efficiency variances.
b.Compute the material price and labor rate variances.Show whether each of the above variances was either favorable or unfavorable.

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Definitions:

Empowered

Being given the authority or power to do something or make decisions independently.

Self-reinforcement

The process whereby individuals or groups reinforce their own behaviors or beliefs through positive outcomes or internal rewards, reinforcing the likelihood of repeated actions.

Positive Self-talk

The practice of making affirmative or supportive statements to oneself to improve confidence and reduce negative feelings.

Scientific Management

A management theory focusing on improving economic efficiency, especially labor productivity, through scientific methods.