Standard Cost System-Materials and Labor Variances
Job No

question 80

Essay

Standard cost system-materials and labor variances
Job no. 811 involved the production of 200 units of product MF. The total standard and actual costs for materials and direct labor on this job are shown below:
Compute the following cost variances for job no. 811. Indicate whether each variance is favorable (F) or unfavorable (U).
(a) Materials price variance: $________________
(b) Materials quantity variance: $________________
(c) Labor rate variance: $________________
(d) Labor efficiency variance: $________________
$$\begin{array} { | c | l | l | } \hline \text { Direct materials: } & \text { Standard } & \text { Actual } \\\hline \text { Standard:520 pounds @ \$3.40 per pound } & \$ 1,768 & \\\hline \text { Actual: } 540 \text { pounds } @ \$ 3.45 \text { per pound } & & \$ 1,863 \\\hline \text { Direct labor: } & & \\\hline \text { Standard: } 220 \text { hours @ \$10 per hour } & \$ 2,200 & \\\hline \text { Actual: } 213 \text { hours } @ \$ 11 \text { per hour } & & \$ 2,343 \\\hline\end{array}$$

Understand symbolic or experiential attributes and their influence on consumer preference.

Recognize the significance of customer satisfaction and its impact on loyalty and advocacy.

Learn about the components of relationship capital and its relevance to competitive advantage.

Understand the difference between business and consumer markets in terms of relationship development risks.

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Definitions:

Accounts Receivable

Funds that are owed to a company by its customers for products or services provided on credit.

Note Receivable

A written promise that one party will receive a certain amount of money from another party at a future date, categorized as an asset.

Honoured

In financial terms, referred to a cheque or payment that has been accepted and processed by the bank.

Adjusting Entries

Journal entries made in accounting to update the records for accruals and deferrals that have not been recorded through regular financial transactions.