Standard variable costs relating to a single kit are given below:
Standard Quantity Standard Price Standard
Or Hours or Rate Cost
Direct Materials ? $6 per yard $?
Direct Labor ? ? ?
Variable MOH ? $2 per DLH ?
Total standard cost per kit $42
During August, 500 kits were manufactured and sold. Selected information relating to the month's production is given below: (for the month)
Materials Direct Variable
Used Labor MOH
Total standard cost ? $8,000 $1,600
Actual cost incurred $10,000 ? $1,620
Material price variance ?
Material quantity variance $600U
Labor rate variance ?
Labor efficiency variance ?
Variable O/H spending variance ?
Variable O/H efficiency variance ?
The following additional information is available for Augusts' production of kits:
Actual direct labor-hours 900
Difference between standard and actual cost
per kit produced during August $0.14 U
REQUIRED:
1. What was the total standard cost of the materials used during August?
2. How many yards of material are required at standard per kit?
3. What was the materials price variance for August?
4. What is the standard direct labor rate per hour?
5. What was the labor rate and efficiency variance for August?
6. What was the variable overhead spending variance for August? The variable overhead efficiency variance?
7. Complete the standard cost card for one kit shown at the beginning of the problem.