Calculation of Materials and Labor Variances
Fritz Corp. manufactures and sells a single product. The company uses a standard cost system. The standard cost per unit of product follows:
The charges to the manufacturing department for November, when 5,000 units were produced, follow:
The Purchasing department normally buys about the same quantity as is used in production during a month. In November, 5,500 lb were purchased at a price of $2.90 per pound.
Required:
Calculate the following from standard costs for the data given.
Use "F" and "U" to indicate favorable and unfavorable variances. Enter all amounts as positive numbers.
1. Materials quantity variance. $ SelectFUItem 2
2. Materials purchase price variance (at time of purchase). $ SelectFUItem 4
3. Labor efficiency variance. $ SelectFUItem 6
4. Labor rate variance. $ SelectFUItem 8