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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:
17,400 pounds @ $0.21 per pound
15,500 pounds @ $0.11 per pound
10,000 pounds @ $0.06 per pound
410 hours @ $14.20 per hour
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 $______________ favorableMaterial Yield Variance $______________ unfavorableMaterial quantity variance $______________ unfavorableb. Calculate the labor efficiency, mix, and yield variancesLabor Mix Variance $______________ favorableLabor Yield Variance $______________ unfavorableLabor 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)
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