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Direct Labor Variances Ada Clothes Company produced 22,000 units during April. The Cutting Department used 4,200 direct labor hours at an actual rate of $11.60 per hour. The Sewing Department used 7,000 direct labor hours at an actual rate of $11.30 per hour. Assume there were no work in process inventories in either department at the beginning or end of the month. The standard labor rate is $11.50. The standard labor time for the Cutting and Sewing departments is 0.2 hour and 0.3 hour per unit, respectively. a. Determine the direct labor rate, direct labor time, and total direct labor cost variance for the (1) Cutting Department and (2) Sewing Department. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Cutting Department Direct Labor Rate Variance Direct Labor Time Variance Total Direct Labor Cost Variance Unfavorable ✓ $ ✓ Sewing Department Favorable Favorable Favorable ✔ time variance, b. The two departments have opposite results. The Cutting Department has a(n) unfavorable ✔rate variance and a(n) favorable resulting in a total favorable ✓ cost variance. In contrast, the Sewing Department has a(n) favorable ✔rate variance but has a(n) unfavorable time variance, resulting in a total unfavorable ✔cost variance. Unfavorable Unfavorable ✔ ✓

Direct Labor Variances Ada Clothes Company produced 22,000 units during April. The Cutting Department used 4,200 direct labor hours at an actual rate of $11.60 per hour. The Sewing Department used 7,000 direct labor hours at an actual rate of $11.30 per hour. Assume there were no work in process inventories in either department at the beginning or end of the month. The standard labor rate is $11.50. The standard labor time for the Cutting and Sewing departments is 0.2 hour and 0.3 hour per unit, respectively. a. Determine the direct labor rate, direct labor time, and total direct labor cost variance for the (1) Cutting Department and (2) Sewing Department. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Cutting Department Direct Labor Rate Variance Direct Labor Time Variance Total Direct Labor Cost Variance Unfavorable ✓ $ ✓ Sewing Department Favorable Favorable Favorable ✔ time variance, b. The two departments have opposite results. The Cutting Department has a(n) unfavorable ✔rate variance and a(n) favorable resulting in a total favorable ✓ cost variance. In contrast, the Sewing Department has a(n) favorable ✔rate variance but has a(n) unfavorable time variance, resulting in a total unfavorable ✔cost variance. Unfavorable Unfavorable ✔ ✓

Managerial Accounting
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter9: Evaluating Variances From Standard Costs
Section: Chapter Questions
Problem 10E: Ada Clothes Company produced 40,000 units during April. The Cutting Department used 12,800 direct...
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Direct Labor Variances Ada Clothes Company produced 22,000 units during April. The Cutting Department used 4,200 direct labor hours at an actual rate of $11.60 per hour. The Sewing Department used 7,000 direct labor hours at an actual rate of $11.30 per hour. Assume there were no work in process inventories in either department at the beginning or end of the month. The standard labor rate is $11.50. The standard labor time for the Cutting and Sewing departments is 0.2 hour and 0.3 hour per unit, respectively. a. Determine the direct labor rate, direct labor time, and total direct labor cost variance for the (1) Cutting Department and (2) Sewing Department. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Cutting Department Unfavorable Favorable Favorable Direct Labor Rate Variance Direct Labor Time Variance Total Direct Labor Cost Variance ✓ ✓ $ Sewing Department Favorable Unfavorable Unfavorable ✔rate variance and a(n) favorable ✔ time variance, b. The two departments have opposite results. The Cutting Department has a(n) unfavorable resulting in a total favorable ✓ cost variance. In contrast, the Sewing Department has a(n) favorable ✔rate variance but has a(n) unfavorable ✔cost variance. time variance, resulting in a total unfavorable ✔ V ✓
Transcribed Image Text:Direct Labor Variances Ada Clothes Company produced 22,000 units during April. The Cutting Department used 4,200 direct labor hours at an actual rate of $11.60 per hour. The Sewing Department used 7,000 direct labor hours at an actual rate of $11.30 per hour. Assume there were no work in process inventories in either department at the beginning or end of the month. The standard labor rate is $11.50. The standard labor time for the Cutting and Sewing departments is 0.2 hour and 0.3 hour per unit, respectively. a. Determine the direct labor rate, direct labor time, and total direct labor cost variance for the (1) Cutting Department and (2) Sewing Department. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Cutting Department Unfavorable Favorable Favorable Direct Labor Rate Variance Direct Labor Time Variance Total Direct Labor Cost Variance ✓ ✓ $ Sewing Department Favorable Unfavorable Unfavorable ✔rate variance and a(n) favorable ✔ time variance, b. The two departments have opposite results. The Cutting Department has a(n) unfavorable resulting in a total favorable ✓ cost variance. In contrast, the Sewing Department has a(n) favorable ✔rate variance but has a(n) unfavorable ✔cost variance. time variance, resulting in a total unfavorable ✔ V ✓
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