Variances(material and labor)?

Question

Standards:

Price per unite(material) 5.00

pounds used per unit(mtl) 2

labor rate per hour: 6.00

labor hours to make product: 3

Actual Results:

purchased 6,000 lbs of material for 33,000 (5.50 per lb) produced 2000 unites of product. used 4,400 lbs of material to make products. Paid for 6,500 hours of labor at 5.80 per hour or 37,000.

Material price variance??

Material usage(quantity) variance??

Total Material variance??

Labor rate variance??

Labor efficiency variance??

total labor variance??

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question 2

compute total overhead variance:???

Standards:

variable overhead per unit: 1.50

fixed overhead pwer unit: 6.00

Actual results

overhead: 400,000

units produced: 50,000

Answer 1

Materials price variance is going to be unfavorable because purchase price was above the standard price.

Materials price variance = 6,000 * ($5.50 - $5.00) = $3,000 (U)

Materials quantity variance is going to be unfavorable because more materials were used per unit than the standard materials per unit.

Materials quantity variance = $5.00 * (4,400 - 4,000) = $2,000 (U)

Total materials variance = $5,000 (U)

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Labor rate variance is going to be favorable because actual rate of $5.80 is less than the standard rate of $6.00

Labor rate variance = 6,500 * ($5.80 - $6.00) = - $1,300 = $1,300 (F)

Labor efficiency variance is going to be unfavorable because actual hours were greater than the standard hours allowed for actual output.

Labor efficiency variance = $6.00 * (6,500 - 6,000) = $3,000 (U)

Total labor variance = $1,700 (U)

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Using the standards, overhead should be 50,000 * $7.50 =  $375,000.

Actual overhead was $400,000.

Total overhead variance = $25,000 (U)