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Direct materials and direct labor variances

Reed Corp. has set the following standard direct materials and direct labor costs per unit for the product it manufactures.

Direct materials (15 lbs. @ $4 per lb.) $60

Direct labor (2 hrs. @ $16 per hr.) 32

During June the company incurred the following actual costs to produce 8,900 units.

Direct materials (136,800 lbs. @ $3.80 per lb.)		$	519,840
Direct labor (22,300 hrs. @ $16.10 per hr.).			359,030

(1) Compute the direct materials price and quantity variances.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M92054094

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