Marvel Parts, Inc., manufactures auto accessories. One of the company’s products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,015 hours each month to produce 2,030 sets of covers. The standard costs associated with this level of production are: |
Total | Per Set of Covers |
||||
Direct materials | $ | 59,276 | $ | 29.20 | |
Direct labor | $ | 8,120 | 4.00 | ||
Variable manufacturing overhead (based on direct labor-hours) |
$ | 3,857 | 1.90 | ||
$ | 35.10 | ||||
During August, the factory worked only 700 direct labor-hours and produced 1,500 sets of covers. The following actual costs were recorded during the month: |
Total | Per Set of Covers |
||||
Direct materials (8,400 yards) | $ | 42,000 | $ | 28.00 | |
Direct labor | $ | 6,300 | 4.20 | ||
Variable manufacturing overhead | $ | 3,150 | 2.10 | ||
$ | 34.30 | ||||
At standard, each set of covers should require 4.00 yards of material. All of the materials purchased during the month were used in production. |
Required: |
1. |
Compute the materials price and quantity variances for August. |
2. |
Compute the labor rate and efficiency variances for August. |
3. |
Compute the variable overhead rate and efficiency variances for August. |
1) Material price variance = (7.3*8400-42000) = 19320 F
Material quantity variance = (1500*4-8400)*7.3 = 17520 U
2) Labor rate variance = (8*700-6300) = 700 U
Labor efficiency variance = (750-700)*8 = 400 F
3) Variable overhead rate variance = (3.8*700-3150) = 490 U
Variable overhead efficiency variance = (750-700)*3.8 = 190 F
Marvel Parts, Inc., manufactures auto accessories. One of the company’s products is a set of seat covers that can be...
Marvel Parts, Inc., manufactures auto accessories. One of the company’s products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,015 hours each month to produce 2,030 sets of covers. The standard costs associated with this level of production are: Total Per Set...
Marvel Parts, Inc., manufactures auto accessories. One of the company’s products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,015 hours each month to produce 2,030 sets of covers. The standard costs associated with this level of production are: Total Per Set...
Marvel Parts, Inc., manufactures auto accessories. One of the company's products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,015 hours each month to produce 2,030 sets of covers. The standard costs associated with this level of production are: Per Set Total...
Marvel Parts, Inc, manufactures auto accessories. One of the company's products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,015 hours each month to produce 2,030 sets of covers. The standard costs associated with this level of production are: Per Set of...
Marvel Parts, Inc., manufactures auto accessories. One of the company’s products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,000 hours each month to produce 2,000 sets of covers. The standard costs associated with this level of production are: Total Per Set...
Marvel Parts, Inc., manufactures auto accessories. One of the company’s products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,005 hours each month to produce 2,010 sets of covers. The standard costs associated with this level of production are: Total Per Set...
Marvel Parts, Inc., manufactures auto accessories. One of the
company’s products is a set of seat covers that can be adjusted to
fit nearly any small car. The company has a standard cost system in
use for all of its products. According to the standards that have
been set for the seat covers, the factory should work 1,065 hours
each month to produce 2,130 sets of covers. The standard costs
associated with this level of production are:
Total
Per Set...
Marvel Parts, Inc., manufactures auto accessories. One of the company’s products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,005 hours each month to produce 2,010 sets of covers. The standard costs associated with this level of production are: Total Per Set...
Marvel Parts, Inc., manufactures auto accessories. One of the
company’s products is a set of seat covers that can be adjusted to
fit nearly any small car. The company has a standard cost system in
use for all of its products. According to the standards that have
been set for the seat covers, the factory should work 1,000 hours
each month to produce 2,000 sets of covers. The standard costs
associated with this level of production are:
Total
Per Set...
Marvel Parts, Inc., manufactures auto accessories. One of the company’s products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,065 hours each month to produce 2,130 sets of covers. The standard costs associated with this level of production are: Total Per Set...