Reference no: EM133187821

Question - Brier Company, manufacturer of car seat covers, provided the following standard costs for its product:

Inputs	Standard Quantity	Standard Cost	Standard Cost Per Unit
Direct Material	7.1 pounds	5 per pound	35.50
Direct labour	0.8 hours	17 per hour	13.60
Variable Overhead	0.8 hours	7 per hour	5.60

The company reported the following in 2022 May:

Original budgeted output 4 700 units

Actual output 4 500 units

Actual direct labour hours 3 610 hours

Actual cost of direct labour $65 341

Purchases of raw materials 36 500 pounds

Actual price paid for raw materials $186 150

Raw materials used 34 150 pounds

Actual variable overhead cost $24 909

Variable overhead is applied on the basis of direct labour hours.

A. Compute the following:

i. Direct materials quantity variance

ii. Direct materials price variance

iii. Direct materials total variance

iv. Direct labour efficiency variance

v. Direct labour rate variance

vi. Direct labour total variance

vii. Variable overhead efficiency variance

viii. Variable overhead rate variance

B. State TWO (2) benefits of standard costing.

C. What are TWO (2) limitations of standard costing?