Acting Company Has the Following Information A Determine the Materials Price Variance and Whether It Is

question 39

Essay

Acting Company has the following information:
$\begin{array}{lrlr}\text { Direct Materials: }&&\text { Direct Labour: }\\\text { Standard Quantity } & 11,000 & \text { Standard Hours } & 3,000 \\\text { Actual Quantity } & 13,000 & \text { Actual Hours } & 2,875 \\\text { Standard Price } & \$ 15 & \text { Standard Rate } & \$ 1 2\\\text { Actual Price } & \$ 13 & \text { Actual Rate } & \$ 13\end{array}$ A. Determine the materials price variance and whether it is favourable or unfavourable.
B. Determine the materials usage variance and whether it is favourable or unfavourable.
C. Determine the labour rate variance and whether it is favourable or unfavourable.
D. Determine the labour efficiency variance and whether it is favourable or unfavourable.

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Definitions:

Marginal Benefit

The extra advantage gained by using an additional unit of a product or service.

Producing

The act or process of creating goods or services by combining labor, materials, and technology.

Fifth Sweatshirt

Additional unit or item, indicative of a point in consumption where assessing marginal utility or other economic factors becomes relevant.

Ability-to-pay

A principle in taxation that states taxes should be levied on individuals or entities based on their ability to pay, which is often measured by income or wealth.