During May Joliet Fabrics Corporation manufactured 500 units

During May, Joliet Fabrics Corporation manufactured 500 units of a special multilayer fabric with the trade name Stylex. The following information from the Stylex production department also pertains to May. Direct material purchased: 18,000 yards at $1.38 per yard Direct material used: 9,500 yards at $1.38 per yard Direct labor: 2,100 hours at $9.15 per hour $ 24,840 13,110 19,215 The standard prime costs for one unit of Stylex are as follows: Direct material: 20 yards at $1.35 per yard Direct labor: 4 hours at $9.00 per hour Total standard prime cost per unit of output $ 27 36 $ 63 Required: Compute the following variances for the month of May. (Indicate the effect of each variance by selecting \"Favorable\" or \"Unfavorable\". Select \"None\" and enter \"0\" for no effect (i.e., zero variance). > Answer is complete but not entirely correct. 1. 2. Direct-material price variance Direct-material quantity variance Direct-material purchase price variance Direct-labor rate variance Direct-labor efficiency variance $ $ $ $ $ 540 (675) (300) (315) 900 Unfavorable Favorable Unfavorable Unfavorable Unfavorable 5.

Solution

Answer

actual price per unit = 1.38 per yard

actual units = 9500 yards

actual units = 500 unit

standard price per unit = 1.35 per yard

standard units for actual production = 500 * 20 yards per unit = 10000 yards

direct material price variancen = actual units * actual price - standard price

= 9500 * 1.38 - 1.35

= 285 unfavourable

direct material quantity variance = standard price * actual units - standard units

= 1.35 * 9500 - 10000

= 675 favorable

direct material purchase price variance = direct material price variance + direct material quantity variance

= 285 + 675

= 960 unfavorable