Question

(1) Standard Quantity or Standard Standard Cost Price (1) (2) $41.75 $15.40 9.20 Inputs Direct materials Hours or Rate 2.50 pounds 1.00 hours $16.70 per pound Direct labor $15.40 per hour $ 9.20 per hour Variable manufacturing overhead 1.00 hours $66.35 Total standard cost per unit Variances Reported Quantity or Efficiency $33,400 U $15,400 U Total Standard Price Cost $668,000 $ 12,180 F $246,400 3,400 U $147,200 $ 4,900 F or Rate Direct materials Direct labor Variable manufacturing overhead $ 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? Number of units produced 1 Pounds of direct material purchased and used in production 2. 3. Actual cost per pound Actual direct labor-hours 4. 5. Actual rate per direct labor-hour Actual variable manufacturing overhead cost 6

Answer 1

1) Number of unit produced = 668000/41.75 = 16000 Units

2) Material quantity variance = (Standard qty-actual qty)Standard price

-33400 = (16000*2.5*16.70-16.70X)

16.70X = 668000+33400

X(actual quantity) = 42000 Pounds

3) Material price variance = (Standard price-actual price)actual quantity

12180 = (16.70*42000-42000X)

42000X = 701400-12180

x(actual price) = 16.41

4) Labor efficiency variance = (Standard hour-actual hour)Standard rate

-15400 = (16000*1*15.40-15.40X)

15.40X = 246400+15400

X(actual hour) = 17000 Hour

5) Labor rate variance = (Standard rate-actual rate)actual hour

-3400 = (15.40*17000-17000X)

17000X = 265200

X(actual rate) = 15.60

6) Variable overhead efficiency variance = (16000-17000)*9.2 = 9200 U

Actual variable overhead = 147200-4900+9200 = 151500