Calculate the material quantity mix and yield variances

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Reference no: EM131795770

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)

Reference no: EM131795770

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