Dodge Company produces a single product.The company has set the following standards for materials and labour:

During the past month, the company purchased 7,000 kilograms of direct materials at a cost of $26,250. All of this material was used in the production of 1,300 units of product. Direct labour cost totalled $55,125 for the month. The following variances have been computed:

Required:

a) For direct materials, compute the standard price per kilogram, the standard quantity allowed for materials in total for the month's production, and the standard quantity per unit of product.
b) For direct labour, compute the actual direct labour cost per hour for the month and the labour rate variance

Question

Dodge Company produces a single product.The company has set the following standards for materials and labour:

During the past month, the company purchased 7,000 kilograms of direct materials at a cost of $26,250. All of this material was used in the production of 1,300 units of product. Direct labour cost totalled $55,125 for the month. The following variances have been computed:

Required:

a) For direct materials, compute the standard price per kilogram, the standard quantity allowed for materials in total for the month's production, and the standard quantity per unit of product.
b) For direct labour, compute the actual direct labour cost per hour for the month and the labour rate variance

Quizplus · Accepted Answer

The Answer of Dodge Company produces a single product.The company has set the following standards for materials and labour:

During the past month, the company purchased 7,000 kilograms of direct materials at a cost of $26,250. All of this material was used in the production of 1,300 units of product. Direct labour cost totalled $55,125 for the month. The following variances have been computed:

Required:

a) For direct materials, compute the standard price per kilogram, the standard quantity allowed for materials in total for the month's production, and the standard quantity per unit of product.
b) For direct labour, compute the actual direct labour cost per hour for the month and the labour rate variance

Dodge Company Produces a Single Product