Question

Problem 23-2A (Part Level Submission) Ayala Corporation accumulates the following data relative to jobs started and finished during the month of June 2017. Costs and Production Data Actual Standard Raw materials unit cost $2.40 $2.20 Raw materials units used 11,000 10,300 Direct labor payroll $162,800 $159,600 Direct labor hours worked 14,800 15,200 Manufacturing overhead incurred $217,464 Manufacturing overhead applied $221,464 Machine hours expected to be used at normal capacity 41,500 Budgeted fixed overhead for June $66,400 Variable overhead rate per machine hour $3.10 Fixed overhead rate per machine hour $1.60 Overhead is applied on the basis of standard machine hours. 3.10 hours of machine time are required for each direct labor hour. The jobs were sold for $478,000. Selling and administrative expenses were $37,900. Assume that the amount of raw materials purchased equaled the amount used. (a) Your answer is correct. Compute all of the variances for (1) direct materials and (2) direct labor. (Round answers to 0 decimal places, e.g. 125.) (1) Total materials variance 37401 Tunfavorable C Materials price variance Materials quantity variance 2 200 Unfavorable 1540 Unfavorable 3200 Tunfavorable 7400 Tunfavorable (2) Total labor variance Labor price variance Labor quantity variance 4200 Favorable Click if you would like to Show Work for this question: Open Show Work SHOW SOLUTION SHOW ANSWER LINK TO TEXT LINK TO TEXT LINK TO TEXT VIDEO: SIMILAR PROBLEM Attempts: 1 of 3 used (b) Your answer is correct. Compute the total overhead variance. Total overhead variance 4000 Favorable

Answer 1

Ayala Corporation 478000 403724 74276 Income Statement For the Month ended 30.6.2017 Sales Revenue Cost of goods sold Gross Profit Variances: Materials Price Materials Quantity Labor Price Labor Quantity Overhead Total Variance Gross Profit (actual) Selling and administrative Expenses Net Income / (Loss) 2200 Unfavourable 1540 Unfavourable 7400 Unfavourable 4200 Favourable 4000 Favourable Unfavourable 2940 71336 37900 33436