Dart Company Developed the Following Standard Costs for Its Product $\bullet$

question 204

Essay

Dart Company developed the following standard costs for its product for 2016:
The company expected to work at the 120,000 direct labor hours level of activity and produce 60,000 units of product.
Actual results for 2016 were as follows:
$\bullet$ 56,800 units of product were actually produced.
$\bullet$ Direct labor costs were $1,092,000 for 112,000 direct labor hours actually worked.
$\bullet$ Actual direct materials purchased and used during the year cost $1,108,800 for 231,000 pounds.
$\bullet$ Total actual manufacturing overhead costs were $680,000.
Instructions
Compute the following variances for Dart Company for 2016 and indicate whether the variance is favorable or unfavorable.
1. Direct materials price variance.
2. Direct materials quantity variance.
3. Direct labor price variance.
4. Direct labor quantity variance.
5. Overhead controllable variance.
6. Overhead volume variance.

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Definitions:

Periosteum

The periosteum is a dense layer of vascular connective tissue enveloping the bones except at the surfaces of the joints.

Nervous System

The network of nerve cells and fibers that transmits nerve impulses between parts of the body, coordinating and controlling bodily functions and activities.

Reflex Arc

The neural pathway that mediates a reflex action involving sensory nerves, a central nervous system integration center, and motor nerves.

Nervous System

An extensive network of specialized cells and tissues responsible for controlling and coordinating body activities by transmitting electrical and chemical signals throughout the body.