Question

Saved Help Save & Exis Chec Problem 10-16 Comprehensive Variance Analysis [LO10-1, LO10-2, LO10-3) Highland Company produces a lightweight backpack that is popular with college students. Standard variable costs relating to a single backpack are given below: Standard Quantity or Hours Standard Price or Rate $6.00 per yard Standard Direct materials Direct labor Cost $7 7 per direct 2 labor-hour Variable manufacturing overhead Total standard cost per unit ? $7 Overhead is applied to production on the basis of direct labor-hours. During March, 520 backpacks were manufactured and sold. Selected information relating to the month's production is given below Variable Manufacturing Overhead $1,456 $1,717 Materials Used $15,600 $14,325 Direct Labor $7,280 Total standard cost allowed Actual costs incurred Materials price variance Materials quantity variance Labor rate variance Labor efficiency variance Variable overhead rate variance Variable overhead efficiency variance $ 1,590 U For the month's production. The following additional information is available for March's production: 780 Actual direct labor-hours Difference between standard and actual cost per backpack produced during March $ 0.20 F

please answer 1 to 8

thank you!

Answer 1

1)	Standard cost for September production
	Materials				15,600
	Direct labor				7,280
	Variable manufacturing overhead				1,456
	total standard cost		(a)		24,336
	number of backpacks produced			(b)	520
	standard cost of single backpack a/b				46.8	answer
2)	Standard cost of a single backpack(above)				46.8
	Deduct Fav variance between std and actual cost				-0.2
	Actual cost per backpack				46.6
3)	total standard cost of materials used (a)				15,600
	number of backpacks produced			(b)	520
	standard material cost per backpacka/b				30
	standard material cost per backpack/standard material cost per yard
	30/6	=	$5	yards per backpack
4)	standard cost of material used				15,600
	actual cost of materials used				14,325
	Total variance				1,275	F
	price variance				2,865	F
	Quantity variance				1590	U	(given)
	total variance				1,275	F
5)	Std VMOH cost				1,456
	std VMOH rate per direct labor hr				2		(given)
	Standard direct labor hours				728
	total std direct labor cost /total standard DLH's
	7,280	/	728	=	10	per DLH	answer
6)	Actual cost per backpack produced				46.6
	number of backpacks produced				520
	total actual cost of production					24232
	less:Actual cost of materials					-14,325
	Actual cost of variable mfg overhead					-1,717
	actual cost of direct labor					8190
	direct labor rate variance
	(AH*AR - SR*AH)
	8190 - 10*780
	390	U
	Direct labor efficiency variance
	(AH-SH)*SR
	(780-728)*10
	520	U
7)	variable overhead rate variance
	(AH*AR - SR*AH)
	1,717	-	780*2
	157	U
	variable overhead efficiency variance
	(AH-SH)*SR
	(780-728)*2
	104	U
			SQ or	SP/SR	standard
8)			SH		cost
	Direct materials		$5	6	30
	Direct labor		1.4	10	14
	VMOH		1.4	2	2.8
	total standard cost per backpack				46.8