## Answers

Paart-1 | ||||||

Standard | Standard | Standard | ||||

Quantity or Hours | Price or Rate | Cost | ||||

Alpha6: | ||||||

Direct materials-X442 | 1.8 | kilos | $2.50 | per kilo | $4.50 | |

Direct materials-Y661 | 2.4 | litres | $1.50 | per litre | $3.60 | |

Direct labor-Sintering | 0.2 | hours | $22.00 | per hour | $4.40 | |

Direct labor-Finishing | 1.2 | hours | $21.50 | per hour | $25.80 | |

tal | $38.30 | |||||

Zeta7: | ||||||

Direct materials-X442 | 4.4 | kilos | $2.50 | per kilo | $11.00 | |

Direct materials-Y661 | 4.4 | litres | $1.50 | per litre | $6.60 | |

Direct labor-Sintering | 0.4 | hours | $22.00 | per hour | $8.80 | |

Direct labor-Finishing | 0.8 | hours | $21.50 | per hour | $17.20 | |

tal | $43.60 |

Part-2 |

2. Material price variance = [SP-AP] x AQ purchased |

Material X442 = [$2.50 - $2.70] x 15100 = $3020 U |

Material Y661 = [$1.50 - $1.40] x 16100 = $1610 F |

Material quantity variance = [SQ-AQ used] x SP |

Material X442 = [{(1.8 x 1700) + (4.4 x 1550)} - 9600] x $2.50= $700 F |

Material Y661 = [{(2.4 x 1700) + (4.4 x 1550)} - 14100] x $1.50 = $4800 U |

* X442 Actual Price per Kilos = 40770/15100=$2.70 |

**Y661, Actual Price Per Litre = 22540/16100=$1.40/ Litre |

Direct material variance - Material X442 | |

Material price variance | $3020 U |

Material quantity variance | $1610 F |

Direct material variance - Material Y661 | |

Material price variance | $700 F |

Material quantity variance | $4800U |

Part-3 | |

3. Direct labor rate variance = [SR-AR] x AH worked | |

Sintering = [23.60 - 22] x 1300 = $2080 F | |

Finishing = [23.50 - 21.50] x 2960 = $5920F | |

*Actual Rate/ Hour for Sintering :- $30680/1300=$23.60 | |

**Actual Rate/ Hour for Finishing :- $69560/2960=$23.50 | |

Direct labor efficiency variance = [SH-AH] x SR | |

Sintering = [{(0.20 x 1700) + (0.40 x 1550)} - 1300] x $23.60 = $8024 U | |

Finishing = [{(1.20x 1700) + (0.8 x 1550)} - 2960] x $23.50 = $7520F | |

Direct labor variances - Sintering: | |

Labor rate variance | $2080F |

Labor efficiency variance | $5920F |

Direct labor variances - Finishing: | |

Labor rate variance | $8024U |

Labor efficiency variance | $7520F |

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