Q1) Standard costs and actual costs for direct labor, direct materials, and factory overhead for manufacture of 2,500 units of product are given below:
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Standard Costs @ 2,500 units:
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Direct materials
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2,500 kilograms @ $8/kg
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Direct labor
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7,500 hours @ $12/hr
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Actual Costs @ 2,500 units:
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Direct materials
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2,600 kilograms @ $8.75
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Direct labor
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7,400 hours @ $11.40
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Labour rate (price) variance is:
i) $5,640 favourable
ii) $4,500 favourable
iii) $4,440 favourable
iv) $ 1,200 favourable
v) $1,140 favourable