Topper Toys has developed a new toy called the Brainbuster. The company has a st

Question

Topper Toys has developed a new toy called the Brainbuster. The company has a standard cost system to help control costs and has established the following standards for the Brainbuster toy:

During August, the company produced 5,300 Brainbuster toys. Production data on the toy for August follow:

Direct labor: 7,390 direct labor-hours were worked at a cost of $57,642.

Material quantity variance: ???

Material price variance: ???

Labor efficiency variance: ???

Labor rate variance: ???

Explanation / Answer

quantity purchased × Standard price) =71,000 *($0.32-$0.34) = -1420 Materials quantity variance = (Actual quantity used × Standard price) - (Standard quantity allowed × Standard price) = 71,000*$0.34 -5,300*6*$0.34 =13328 b.Labor rate variance = (Actual hours worked × Actual rate) - (Actual hours worked × Standard rate) labor price variances = 7,390*($57,642/7,390 - $13) = 48035 Labor efficiency variance = (Actual hours worked × Standard rate) - (Standard hours allowed × Standard rate) = 7,390*$7.40 - 5,300*1.3*$7.40 =3700

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