Duboise Corporation Makes a Product with the Following Standard Costs

question 108

Essay

Duboise Corporation makes a product with the following standard costs:
The company reported the following results concerning this product in October.
The materials price variance is recognized when materials are purchased. Variable overhead is applied on the basis of direct labor-hours.
Required:
a. Compute the materials quantity variance.
b. Compute the materials price variance.
c. Compute the labor efficiency variance.
d. Compute the labor rate variance.
e. Compute the variable overhead efficiency variance.
f. Compute the variable overhead rate variance.

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Definitions:

User Cost

User cost comprises the costs associated with the use of a product or service, including wear and tear, maintenance, and the opportunity cost of forgone alternatives.

Extract

To remove or obtain a substance from a source through a process.

Resource

An asset or input used to produce goods and services, such as labor, capital, land, and knowledge.

Nonrenewable Resource

A natural resource that cannot be readily replaced by natural means at a quick enough pace to keep up with consumption.