Question: Direct labor and direct material variance, missing data. (CMA, heavily adapted). Morro Bay Surfboards manufactures fiberglass surfboards. The standard cost of direct materials and direct manufactures labor is $100 per board. This includes 20 pounds of direct materials, at the budgeted price of $2 per pound, and five hours of direct manufacturing labor, at the budgeted rate of $12 per hour. Following are the data for the month of July:
| Units completed |
6000 units |
| Direct materials purchased |
150,000 pounds |
| Cost of direct materials purchases |
$292,500 |
| Actual direct manufacturing labor-hours |
32,000 hours |
| Actual direct-labor cost |
$368,000 |
| Direct materials efficiency variance. |
$12,500 U |
There were no beginning inventories.
1) Compute direct manufacturing labor variance for July.
2) Compute the actual pounds of direct materials used in production in July.
3) Calculate the actual price per pound of direct materials purchased.
4) Calculate direct materials price variance.