Retro Wear manufactures dresses in a small facility in Potsdam, New York. Information about the production week is as follows:
Standard wage per hour $10.70
Standard labor time per dress 12 minutes
Standard number of yards of fabric per dress 3.5 yards
Standard price per yard of fabric $2.90
Actual price per yard of fabric $2.75
Actual yards of fabric used this week 12,100 yards
Number of dresses made this week 3,250
Actual wage per hour $11.00
Actual hours worked this week 700 hours
Required:
A) Determine the standard cost per dress for direct materials and direct labor.
B) Determine the total DIRECT MATERIALS cost variance, the DM price variance, and the DM quantity variance.
C) Would you adjust your materials standards? Explain your answer.
D) Determine the total DIRECT LABOR cost variance, the DL rate variance, and the DL time variance.