Answer to Question #160422 in Economics for Fyatt

Question

Young Bay Surfboards manufactures fiberglass surfboards. The standard cost of direct materials and direct manufacturing labor is $223 per board. This includes 40 pounds of direct materials, at the budgeted price of $2 per pound, and 10 hours of direct manufacturing labor, at the budgeted rate of $14.30 per hour. Following are additional data for the month of July:

Units completed                                           5,500 units

Direct material purchases                            160,000 pounds

Cost of direct material purchases                $432,000

Actual direct manufacturing labor-hours     41,000 hours

Actual direct labor cost                                 $594,500

Direct materials efficiency variance             $ 1,700 F

There were no beginning inventories.

Required:

Compute the actual pounds of direct materials used in production in July.

Answer 1

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