Question

Vitex, Inc. manufactures a popular consumer product and it has provided the following data excerpts from its standard cost system: Inputs (2) Standard Standard Cost (1) Standard Quantity Price (1) x or Hours or Rate (2) per 2.20 pounds 16.70 pound 1.00 hours $15.80 per hour $15.80 1.00 hours * 9.60 per hour $ 9.60 $62.14 Direct materials Direct labor Variable manufacturing overhead Total standard cost per unit $36.74 Total Variances Reported Standard Price Quantity or Cost or Rate Efficiency Direct materials $698,060 $12,702 F $33,400 U Direct labor $300,200 $ 4,090 U $15,800 U Variable manufacturing overhead $182,400 $ 4,800 F $ TU *Applied to Work in Process during the period. The company's manufacturing overhead cost is applied to production on the basis of direct labor-hours. All of the materials purchased during the period were used in production. Work in process inventories are insignificant and can be ignored. Required: : 1. How many units were produced last period? 2. How many pounds of direct material were purchased and used in production? 3. What was the actual cost per pound of material? (Round your answer to 2 decimal places.) : 4. How many actual direct labor-hours were worked during the period? 5. What was the actual rate paid per direct labor-hour? (Round your answer to 2 decimal places.) :6. How much actual variable manufacturing overhead cost was incurred during the period? 1. 2. Pour 3. 4. 5. 6. Number of units produced Pounds of direct material purchased and used in production Actual cost per pound Actual direct labor-hours Actual rate per direct labor-hour Actual variable manufacturing overhead cost

Answer 1

1	Number of Units Produced = Total Standard Cost/ Standard Cost Per Unit
	= (698060+300200+182400)/ 62.14 per unit
	19000
	units
2	Material Quantity Variance = (Standard Quantity−Actual Quantity)× Standard Price
	33400 = (19000 units * (2.2 pounds per unit ) - AQ )*16.7 per pound
	Actual Quantity =
	=41800+2000
	43800
3	Material Price Variance = (Standard Price−Actual Price)×Actual Quantity
	12702 = (16.7 per pound - actual price )*43800 pound
	Actual price =
	= 16.7-.29
	16.41
4	Direct Labor Efficiency Variance = (Standard Hour − Actual Hour ) × Standard Rate
	15800 = (19000 - actual hour ) *15.8
	= 18000
5	Computation of actual rate paid per direct labor hour.
	Direct Labor Rate Variance = (Standard Rate − Actual Rate) × Actual Hours
	4000 = (15.8 - actual rate)*18000 hours
	16.022
6	Computation of actual variable manufacturing overhead incurred
	Variable Manufacturing Overhead Rate Variance = (Standard Rate × Actual Hour)−(Actual Rate × Actual Hour)
	4800 = (9.6 per hour * 18000 hours) - (Actual Variable Manufacturing Overhead)
	168000