
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Huron Company produces a cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom
are given below:
Direct materials
Direct labor
Standard Quantity
or Hours
6.40 pounds
0.40 hours
Standard Price or Rate
$ 3.00 per pound
$ 11.00 per hour
Materials price variance
Materials quantity variance
Standard
Cost
$19.20
$4.40
During the most recent month, the following activity was recorded:
a. Twelve thousand four hundred pounds of material were purchased at a cost of $2.90 per pound.
b. The company produced only 1,240 units, using 11,160 pounds of material. (The rest of the material purchased remained in raw
materials inventory.)
c. 596 hours of direct labor time were recorded at a total labor cost of $7,152.
Required:
Compute the materials price and quantity variances for the month.
Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero
variance). Input all amounts as positive values. Do not round intermediate calculations.
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