The Following Information Is Available for Lima, Inc

question 42

Essay

The following information is available for Lima, Inc.:

Using the above information, compute the following ratios.

---

Definitions:

Direct Material Quantity Variance

The difference between the actual amount of direct materials used and the standard amount expected to be used, multiplied by the standard cost per unit of material.

Actual Quantity Purchased

The true amount of materials or goods that a company buys within a specific time frame, which can be compared to budgeted or planned quantities.

Fixed Manufacturing Overhead Volume Variance

The difference between budgeted fixed manufacturing overhead and the amount applied to production, based on standard hours.

Standard Direct Labour-Hours

The estimated amount of labor time that should be required to produce one unit of a product.