Question

Flint Clothiers is a small company that manufactures tall-men’s suits. The company has used a standard cost accounting system. In May 2017, 10,000 suits were produced. The following standard and actual cost data applied to the month of May when normal capacity was 14,500 direct labor hours. All materials purchased were used. Part B.

Problem 15-3 (Part Level Submission) Flint Clothiers is a small company that manufacturas tall-men's suits. The company has used a standard cost accounting system. In May 2017, 10,000 suits were produced. The following standard and actual cast data applied to the month of May when normal capacity was 14,500 direct labor hours. All materials purchased were used. Cost Element Direct materials Direct labor Overhead Standard (per unit) 10 yards at $4.50 per yarn 1.10 hours at $14.00 per hour 1.10 hours at 56.10 per hour (lixed $3.60; variable $2.80) Actual $443,090 for 100,700 yards (54.40 per yand) $169,650 for 11,700 hours ($14.50 per hour) $48,700 fixed overhead $36,500 variable overhead Overhead is applied on the basis of direct labur hours. Aromal capacity, budgeled lixed overhead costs were $52,200, and bullyeled variable over het was 540,500. (a) Your answer is partially correct. Try again. Cornpute the lulel, price, and quantity veriences lur (1) malerials and (2) labor. (Round answers to 0 decimal places, e.g. 125.) (1) Total materials variante Favorable Materials price variance Favorable Malerials quanlily variance I 5,930. Unfavorable 200.00 (2) Total labor varianoc Unfavorable Labor ure variance Unfavorable Laber quantity variance Unfavorable

Answer 1

Solution a:

Direct Material Cost Variance
Actual Cost					Standard cost for actual quantity					Standard Cost
AQ *	AP =				AQ *	SP =				SQ *	SP =
100700	$4.40	$443,080.00			100700	$4.50	$453,150.00			100000	$4.50	$450,000.00
			$10,070.00	Favorable				$3,150.00	Unfavorable
			Direct Material Price Variance					Direct Material Qty variance
Direct material price variance					$10,070.00	Favorable
Direct material quantity variance					$3,150.00	Unfavorable
Total direct material variance					$6,920.00	Favorable

Direct Labor Cost Variance
Actual Cost					Standard cost for actual quantity					Standard Cost
AH *	AR =				AH *	SR =				SH *	SR =
11700	$14.50	$169,650.00			11700	$14.00	$163,800.00			11000	$14.00	$154,000.00
			$5,850.00	Unfavorable				$9,800.00	Unfavorable
			Direct Labor rate Variance					Direct Labor Efficiency Variance
Direct Labor Rate variance					$5,850.00	Unfavorable
Direct Labor Efficiency variance					$9,800.00	Unfavorable
Total direct labor variance					$15,650.00	Unfavorable

Solution 2:

Total overhead variance = Overhead applied - Actual overhead

= (11000*$6.40) - ($48,700 + $36,500)

= $70,400 - $85,200 = $14,800 U