Q1) Standard costs and actual costs for direct labor, direct materials, and factory overhead for manufacture of 2,500 units of product are given:
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Standard Costs @ 2,500 units:
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Direct materials
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2,500 kilograms @ $8/kg
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Direct labor
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7,500 hours @ $12/hr
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Actual Costs @ 2,500 units:
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Direct materials
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2,600 kilograms @ $8.75
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Direct labor
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7,400 hours @ $11.40
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Amount of direct materials price variance is:
i) $1,875 unfavourable
ii) $1,950 favourable
iii) $1,950 unfavourable
iv) $1,875 favourable
v) $800 unfavourable