Question

of their care product 8 Harrisone has the following stands for the for the production of the following standards for the materials ths. Standard quantity per wit of our Standard Standard price S19.15 per pound The following data pertantoperations concerning the product for the last mc Actual materials purchased 9000 Actual cost of materiale purchased S171.000 Actual materials used in production 7.100 lbs. Actual output 700 units What is the purchase price variance of the materials for the month? 31.065.00 Favorable в $1,350.00 Unfavorable $1,350,00 Favorable $1.065.00 Unfavorable E. None of the above Taft Corporation uses a standard costing system in which variable manufacturing overhead is assigned to production on the basis of machine hours. The following data pertain to one month's operations Variable manufacturing overhead cost incurred: $68,000 Total flexible budget variable overhead cost: $74,550 Standard machine hours allowed for actual production: 3,550 MHs Actual machine hours incurred: 3,000 MHS A 9 The variable overhead rate variance is: $6,550 Favorable $6,550 Unfavorable $5,000 Favorable $5,000 Unfavorable E. None of the above

Answer 1

8

Purchase price variance = Actual cost of materials purchased-(Actual quantity purchased*Standard price)

Purchase price variance = 171000-(9000*19.15)= $1,350.00 Favorable

Option C is correct

9

Standard rate = 74550/3550= $21

Variable overhead rate variance = Variable manufacturing overhead cost-(Actual hours*Standard rate)

Variable overhead rate variance = 68000-(3000*21)= $5,000 Unfavorable

Option D is correct