Kropf Incorporated has provided the following data concerning one of the products in its standard cost system. Variable manufacturing
overhead is applied to products on the basis of direct labor-hours.
Inputs
Standard Quantity or
Hours per Unit of Output
Standard Price or Rate
Direct materials
9.40 liters
$ 9.00 per liter
Direct labor
0.60 hours
$ 24.70 per hour
Variable manufacturing overhead
0.60 hours
$ 7.90 per hour
The company has reported the following actual results for the product for September:
Actual output
11,600 units
Raw materials purchased
110,000 liters
Actual cost of raw materials purchased
$ 1,010,500
Raw materials used in production
109,070 liters
Actual direct labor-hours
6,380 hours
Actual direct labor cost
$ 160,302
Actual variable overhead cost
$ 45,414
Required:
a. Compute the materials price variance for September.
b. Compute the materials quantity variance for September.
c. Compute the labor rate variance for September.
d. Compute the labor efficiency variance for September.
e. Compute the variable overhead rate variance for September.
f. Compute the variable overhead efficiency variance for September.
(Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero
variance). Input all amounts as positive values.)
a. Materials price variance
b. Materials quantity variance
c. Labor rate variance
d. Labor efficiency variance
e. Variable overhead rate variance
f. Variable overhead efficiency variance
$\hspace{1cm}20,500\hspace{1cm}U
