Refliections, Inc. is a company that manufactures premium car wax. The company uses a standard cost system. From the accounting records of the firm you obtain the following information:
Standard material cost-------------- $3.90 per pound
Standard direct labor cost--------- $6.00 per hour
Standard pounds per unit---------- 5 pounds
Standard labor hours per unit----- 3 hours
Materials purchased ---------------- 39,500 (used 39,000) (this was a correction, not really sure how to interpret)
Direct labor used---------------------- 25,000 hours
Actual material cost----------------- $4.05 per pound
Actual labor cost--------------------- $6.95 per hour
Number of units actually produced------ 8,000 units
Number of units planned-------------------- 10,000 units
- Calculate the materials price and quantity variances.
- Calculate the labor rate and efficiency variances.