Calculate the Market Clearing Price and Quantity

Why the standard price and quantity for each product cost are separated?

Lewis Company’s standard labor cost of producing one unit of Product DD is 3.9 hours at the rate of $13.0 per hour. During August, 42,000 hours of labor are incurred at a cost of $13.20 per hour to produce 10,600 units of Product DD. (a) Compute the total labor variance. Total labor variance $ (b) Compute the labor price and quantity variances. Labor price variance $ Labor quantity variance $ (c) Compute the labor price and quantity variances, assuming the standard is 4.2 hours of direct labor at $13.40 per hour. Labor price variance $ Labor quantity variance

Exercise 11-5 The standard cost of Product B manufactured byPharrell Company includes 2.6 units of direct materials at $6.0 perunit. During June, 26,700 units of direct materials are purchasedat a cost of $5.90 per unit, and 26,700 units of direct materialsare used to produce 10,100 units of Product B. (a) Compute thetotal materials variance and the price and quantity variances.Total materials variance $ Materials price variance $ Materialsquantity variance $ (b) Compute the total materials variance andthe price and quantity variances, assuming the purchase price is$6.05 and the quantity purchased and used is 26,500 units. Totalmaterials variance $ Materials price variance $ Materials quantityvariance $

Exercise 11-6 Lewis Company’s standard labor cost of producingone unit of Product DD is 3.0 hours at the rate of $12.6 per hour.During August, 40,500 hours of labor are incurred at a cost of$12.75 per hour to produce 13,300 units of Product DD. (a) Computethe total labor variance. Total labor variance $ (b) Compute thelabor price and quantity variances. Labor price variance $ Laborquantity variance $ (c) Compute the labor price and quantityvariances, assuming the standard is 3.2 hours of direct labor at$12.85 per hour. Labor price variance $ Labor quantity variance$