Reference no: EM132565142

Question - John's Surfboards manufactures fibreglass surfboards. The standard cost of direct materials and direct manufacturing labour is $100 per board. This includes 20 kg of direct materials, at the budgeted price of $2 per kilogram, and 5 hours of direct manufacturing labour, at the budgeted rate of $12 per hour. Following are additional data for the month of July:

Units completed 6,000 units

Direct material purchases 150,000 kilograms

Cost of direct material purchases $292,500

Actual direct manufacturing labour-hours 32,000 hours

Actual direct labour cost $368,000

Direct material efficiency variance $12,500 U

There were no beginning inventories.

Required -

1. Compute direct manufacturing labour variances for July.

2. Compute the actual kilograms of direct materials used in production in July.

3. Calculate the actual price per kilogram of direct material purchased.

4. Calculate the direct materials price variance.