Problem: Algorithmic
Appendix
Haddas Ltd. makes Healthy Life, a nutritional aid. For a 50-pound batch, standard material and labor costs are as follows:
|
Quantity
|
Unit Price
|
Total
|
|
Wheat
|
23.0 pounds
|
$ 0.18 per pound
|
$4.14
|
|
Barley
|
27.0 pounds
|
0.10 per pound
|
2.70
|
|
Corn
|
10 pounds
|
0.04 per pound
|
0.40
|
|
Skilled labor
|
0.8 hour
|
14.00 per hour
|
11.20
|
|
Unskilled labor
|
0.2 hour
|
8.00 per hour
|
1.60
|
During June, the following materials and labor were used in producing 600 batches of Healthy Life:
|
Wheat
|
17,400 pounds @ $0.21 per pound
|
|
Barley
|
15,500 pounds @ $0.11 per pound
|
|
Corn
|
10,000 pounds @ $0.06 per pound
|
|
Skilled labor
|
410 hours @ $14.20 per hour
|
|
Unskilled labor
|
250 hours @ $9.00 per hour
|
a. Calculate the material quantity, mix, and yield variances. Round your answers to the nearest dollar
Material Mix Variance $______________ favorable
Material Yield Variance $______________ unfavorable
Material quantity variance $______________ unfavorable
b. Calculate the labor efficiency, mix, and yield variances
Labor Mix Variance $______________ favorable
Labor Yield Variance $______________ unfavorable
Labor Efficiency Variance $______________ unfavorable
a.) Material Mix Variance = (AM x AQ x SP) - (SM x AQ x SP)
Material Yield Variance = (SM x AQ x SP) - (SM x SQ x SP)
b.) Labor Rate Variance = (AM x AH x AR) - (AM x AH x SR)
Labor Mix Variance = (AM x AH x SR) - (SM x AQH x SR)
Labor Yield Variance = (SM x AH x SR) - (SM x SH x SR)