Dodge Company Produces a Single Product During the Past Month,the Company Purchased 7,000 Kilograms of Direct

Essay

Dodge Company produces a single product.The company has set the following standards for materials and labour:
$\begin{array}{|l|r|r|}\hline & \text { Direct Materials } & \text { Direct Labour } \\\hline \text { Standard quantity or hours per unit } & \text { ? kilograms } & \text { 3 hours } \\\hline \text { Standard price or rate } & \text { ? per kilogram } & \text { \$15 per hour } \\\hline \text { Standard cost per unit } & ? & \$ 45 \\\hline\end{array}$
During the past month,the company purchased 7,000 kilograms of direct materials at a cost of $26,250.All of this material was used in the production of 1,300 units of product.Direct labour cost totalled $55,125 for the month.The following variances have been computed:
$\begin{array}{|l|r|}\hline \text { Materials price variance } & \$ 1,750 \text { favourable } \\\hline \text { Total materials variance } & \$ 250 \text { unfavourable } \\\hline \text { Labour efficiency variance } & \$ 6,000 \text { favourable } \\\hline\end{array}$
Required:
a)For direct materials,compute the standard price per kilogram,the standard quantity allowed for materials in total for the month's production,and the standard quantity per unit of product.
b)For direct labour,compute the actual direct labour cost per hour for the month and the labour rate variance.