1 The following data is given for the Stringer Company Budge

1. The following data is given for the Stringer Company:

Budgeted production

26,000 units

Actual production

27,500 units

Materials:

  Standard price per ounce

$6.50

  Standard ounces per completed unit

8

  Actual ounces purchased and used in production

228,000

  Actual price paid for materials

$1,504,800

Labor:

  Standard hourly labor rate

$22 per hour

  Standard hours allowed per completed unit

6.6

  Actual labor hours worked

183,000

  Actual total labor costs

$4,020,000

Overhead:

  Actual and budgeted fixed overhead

$1,029,600

  Standard variable overhead rate

$24.50 per standard labor hour

  Actual variable overhead costs

$4,520,000

Overhead is applied on standard labor hours.

The direct materials price variance is______________________________________

         

The direct materials quantity variance is___________________________________

1. The following data is given for the Stringer Company: Budgeted production 26,000 units Actual production 27,500 units Materials:   Standard price per ounce $6.50   Standard ounces per completed unit 8   Actual ounces purchased and used in production 228,000   Actual price paid for materials $1,504,800 Labor:   Standard hourly labor rate $22 per hour   Standard hours allowed per completed unit 6.6   Actual labor hours worked 183,000   Actual total labor costs $4,020,000 Overhead:   Actual and budgeted fixed overhead $1,029,600   Standard variable overhead rate $24.50 per standard labor hour   Actual variable overhead costs $4,520,000 Overhead is applied on standard labor hours.

Solution

Direct materials price variance (Actual rate - standard rate)*Actual qty purchased (1,504,800     - 6.5*228000) 22800 U Direct materials quantity variance (Actual qty used - standard qty allowed)*Standard rate (228,000         - 27500*8)*8 64000 U