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Chris S. Wallace ( Smalls) recently bid on a job, 5000 yards of concrete @...

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Accounting

Chris S. Wallace ( Smalls) recently bid on a job, 5000 yards of concrete @ $ 125 per yard= $ 625,000 PLUS direct labor 8000 hours @ $ 65 per hour = $ 520,000 PLUS a markup for the overhead of $ 50,000 PLUS profit of $ 100,000. So, the total bid was $ 1,295,000 ( including overhead and profit). The job took six months and was managed by Shawna Combs. The job is now over and things didn't go as planned.

The job ended up COSTING $ 1,410,000. 5500 yards of concrete was used costing $ 120 per yard. It took 10,000 hours to complete the job at labor cost of $ 700,000. In summary, material cost was $ 660,000, labor cost was $ 700,000 and overhead was $ 50,000 ( on budget) = $ 1,410.000. So, they did not make their $ 100,000 profit and lost money on the job since costs exceeded their bid.

Calculate material price variance, material quantity variance, labor rate variance, and labor efficiency variance. ( identify as favorable or unfavorable).

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