Topper Toys has developed a new toy called the Brainbuster. The company has a standard cost system to help control costs and has established the following standards for the Brainbuster toy:
Direct materials: 7 diodes per toy at $0.34 per diode
Direct labor: 1.4 hours per toy at $7.10 per hour
During August, the company produced 5,300 Brainbuster toys. Production data on the toy for August follow:
Direct materials: 74,000 diodes were purchased at a cost of $0.30 per diode. 27,625 of these diodes were still in inventory at the end of the month.
Direct labor: 8,020 direct labor-hours were worked at a cost of $60,150.
1. Compute the following variances for August
a. Direct materials price and quantity variances.
Material price variance?
Material quantity variance?
b. Direct labor rate and efficiency variances.
Labor rate variance?
Labor efficiency variance?