Question

# You have been given the following information about the production of Usher Co., and are asked...

You have been given the following information about the production of Usher Co., and are asked to provide the plant manager with information for a meeting with the vice president of operations.

 Standard Cost Card Direct materials (7 pounds at \$5 per pound) \$35.00 Direct labor (0.70 hours at \$10) 7.00 Variable overhead (0.70 hours at \$4 per hour) 2.80 Fixed overhead (0.70 hours at \$8 per hour) 5.60 \$50.40

The following is a variance report for the most recent period of operations.

 Variances Costs Total Standard Cost Price Quantity Direct materials \$406,000 \$8,300 F \$9,000 U Direct labor 81,200 3,924 U 6,000 U

How many units were produced during the period?

 Number of units

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How many pounds of raw materials were purchased and used during the period?

 Raw material pounds

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What was the actual cost per pound of raw materials? (Round answer to 2 decimal places, e.g. 1.25.)

 Actual cost per pound of raw materials \$ /lb

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How many actual direct labor hours were worked during the period?

 Actual direct labor hours hours

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What was the actual rate paid per direct labor hour? (Round answer to 2 decimal places, e.g. 1.25.)

 Actual rate paid per direct labor hour \$ /hr

1) Number of unit = 406000/35 = 11600 Units

2) Material quantity variance = (Standard qty-actual qty)Standard price

-9000 = (11600*7*5-5X)

5X = 406000+9000

X(actual quantity purchased and used) = 415000/5 = 83000 Pounds

3) Material price variance = (Standard price-actual price)actual qty

8300 = (5*83000-83000X)

83000X = 406700

X(Actual price) = 4.9

4) Labor efficiency variance = (Standard hour-actual hour)Standard rate

-6000 = (11600*.7*10-10X)

10X = 81200+6000

X(actual hour) = 8720 Hour

5) Labor rate variance = (Standard rate-actual rate)actual hour

-3924 = (10*8720-8720X)

8720X = 91124

X(actual rate) = 10.45