# Helix Company_Standard Cosy_Variances

Question # 00005533 Posted By: ACCOUNTS_GURU Updated on: 12/17/2013 09:24 AM Due on: 12/31/2014
Subject Accounting Topic Accounting Tutorials:
Question

Helix Company produces several products in its factory, including a karate robe. The company uses a standard cost system to assist in the control of costs. According to the standards that have been set for the robes, the factory should work 780 direct labor-hours each month and produce 1,950 robes. The standard costs associated with this level of production are as follows:

Total Per Unit of Product
Direct materials . . . . . . . . . . . . . . . . . . \$35,490 \$18.20
Direct labor . . . . . . . . . . . . . . . . . . . . . . \$7,020 3.60
direct labor-hours) . . . . . . . . . . . . . . . . .\$2,340 1.20
\$23.00

During April, the factory worked only 760 direct labor-hours and produced 2,000 robes. The following actual costs were recorded during the month:

Total Per Unit of Product
Direct materials (6,000 yards) . . . . . . .\$36,000 \$18.00
Direct labor . . . . . . . . . . . . . . . . . . . . . . \$7,600 3.80
Variable manufacturing overhead . . . . \$3,800 1.90
\$23.70
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At standard, each robe should require 2.8 yards of material. All of the materials purchased during the month were used in production.

Required:
Compute the following variances for April:
1. The materials price and quantity variances.
2. The labor rate and efficiency variances.
3. The variable manufacturing overhead rate and efficiency variances

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1. ## Solution: Helix Company_Standard Cosy_Variances

Tutorial # 00005337 Posted By: ACCOUNTS_GURU Posted on: 12/17/2013 09:27 AM
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