Solution 1:
Computation of Standard cost of a Single Backpack | |
Standard cost for March Production | |
Materials | $9,540 |
Direct Labor | $5,936 |
Variable Manufacturing Overhead | $1,484 |
Total Standard Cost | $16,960 |
Number of Backpacks Produced | 530 |
Standard cost of a single Backpack | $32.00 |
Solution 2:
Computation of Actual cost per Backpack | |
Standard cost of a single Backpack | $32.00 |
Less: Difference Between Standard and actual Cost | $0.20 |
Actual Cost per Backpack | $31.80 |
Solution 3:
Computation of Number of yards at standard per Backpack | |
Total Standard cost of materials allowed during march | $9,540 |
/Number of Backpacks Produced during march | 530 |
Standard material cost per Backpack | $18.00 |
/Standard material cost per yard | $4.50 |
Number of yards per Backpack | 4.0 |
Solution 4:
Material price variance = Total material variance - Material quantity variance |
Total material cost variance = $9540 - $8645 = $1365 F |
Material quantity variance = $1575 U |
Material price variance = $895 F - ($1575 U) = $2470 F |
Material Price Variance | $2,470 | F |
Material Quantity Variance | $1,575 | U |
Spending Variance | $895 | F |
Solution 5:
Computation of standard Direct labor rate per hour | |
Standard Variable manufacturing overhead cost | $1,484 |
Standard Variable manufacturing overhead rate per hour | $2 |
Standard Direct labor hours for March | 742 |
Standard Direct labor Cost for march | $5,936 |
Standard direct labor rate per hour | $8.00 |
Solution 6: |
Total actual cost of backpack produced = 530* $31.80 = $16,854 |
Direct labor cost incurred = $16854 - $8645 - $1690 = $6519 |
Actual direct labor hours = 795 hours |
Actual rate of Direct labor = $6519 / 795 = $8.20 per hour |
Direct labor rate variance = (SR - AR) * AH = ($8.00 - $8.20) *795 = $159 U |
Direct labor efficiency variance = (SH - AH) * SR = (742- 795) * $8.00 = $424 U |
Solution 7: |
Actual rate of variable overhead = $1690/795 = $2.125786 per hour |
Variable overhead rate variance = (SR - AR) * AH = ($2 - $2.125786) *795 = $100 U |
Variable overhead efficiency variance = (SH - AH) * SR = (742 - 795) * $2 = $106 U |
Solution 8:
Standard cost Card - Highland Company | |||||
Standard Quantity or Hours | Standard price or rate | Standard Cost | |||
Direct material | 4 | yards | $4.50 | Per Yard | $18.00 |
Direct labor (742/530) | 1.4 | hours | $8.00 | Per DLH | $11.20 |
Variable overhead | 1.4 | hours | $2.00 | Per DLH | $2.80 |
Standard cost per unit | $32.00 |
Check my work Highland Company produces a lightweight backpack that is popular with college students. Standard...
Highland Company produces a lightweight backpack that is popular with college students. Standard variable costs relating to a single backpack are given below: Standard Quantity or Hours Standard Price Or Rate $4.50 per yard Standard Cost Direct materials Direct labor Variable manufacturing overhead Total standard cost per unit $ 2 per direct labor-hour Overhead is applied to production on the basis of direct labor-hours. During March, 530 backpacks were manufactured and sold. Selected information relating to the month's production is...
Highland Company produces a lightweight backpack that is popular with college students. Standard variable costs relating to a single backpack are given below Standard Price or Rato standard Cost standard Quantity or Hours Direct materials Direct labor $4.58 per yard per direct labor Variable manufacturing overhead Total standard cost per unit $2 hour Overhesd is applied to production on the basis of direct labor-hours. During March, 530 backpscks were manufactured and sold Selected information relating to the month's production is...
Highland Company produces a lightweight backpack that is popular with college students. Standard variable costs relating to a single backpack are given below:Standard Quantity or HoursStandard Price or RateStandard CostDirect materials?$6.00 per yard$?Direct labor???Variable manufacturing overhead?$2 per direct labor-hour?Total standard cost$?Overhead is applied to production on the basis of direct labor-hours. During March, 530 backpacks were manufactured and sold. Selected information relating to the month's production is given below: Materials UsedDirect LaborVariable Manufacturing OverheadTotal standard cost allowed ^(**)$15,900$7,420$1,484Actual costs incurred$13,750?$1,708Materials price variance?Materials...
Highland Company produces a lightweight backpack that is popular with college students. Standard variable costs relating to a single backpack are given below: Standard Quantity or Hours Standard Price or Rate Standard Cost Direct materials ? $ 5.00 per yard $ ? Direct labor ? ? ? Variable manufacturing overhead ? $ 2 per direct labor-hour ? Total standard cost per unit $ ? Overhead is applied to production on the basis of direct labor-hours. During March, 440 backpacks were...
Highland Company produces a lightweight backpack that is popular with college students. Standard variable costs relating to a single backpack are given below: Standard Standard Price Standard Quantity Cost or Rate or Hours $4.00 per yard Direct materials $ ? Direct labor ? ? Variable manufacturing overhead per direct 2 labor-hour ? $ Total standard cost per unit Overhead is applied to production on the basis of direct labor-hours. During March, 420 backpacks were manufactured and sold. Selected information relating...
Highland Company produces a lightweight backpack that is popular with college students. Standard variable costs relating to a single backpack are given below: Standard Quantityor HoursStandard Priceor RateStandardCostDirect materials?$6per yard$?Direct labor???Variable manufacturing overhead?$3per direct labor-hour?Total standard cost per unit$? Overhead is applied to production on the basis of direct labor-hours. During March, 1,000 backpacks were manufactured and sold. Selected information relating to the month’s production is given below: MaterialsUsedDirect LaborVariableManufacturingOverheadTotal standard cost allowed*$16,800$21,000$4,200Actual costs incurred$15,000?$3,600Materials price variance?Materials quantity variance$1,200ULabor rate variance?Labor efficiency variance?Variable...
Highland Company produces a lightweight backpack that is popular with college students. Standard variable costs relating to a single backpack are given below: Standard Quantity or Hours Standard Price or Rate Standard Cost Direct materials ? $ 4.00 per yard $ ? Direct labor ? ? ? Variable manufacturing overhead ? $ 2 per direct labor-hour ? Total standard cost per unit $ ? Overhead is applied to production on the basis of direct labor-hours. During March, 700 backpacks were...
Highland Company produces a lightweight backpack that is popular with college students Standard variable costs relating to a single backpack are given below. Standard Quantity or Hours Standard Price or Rate $6.00 per yard Standard Cost Direct materials Direct labor Variable manufacturing overhead Total standard cost per unit per direct labor 2 hour $ Overhead is applied to production on the basis of direct labor-hours. During March, 400 backpacks were manufactured and sold Selected information relating to the month's production...
Highland Company produces a lightweight backpack that is popular with college students. Standard variable costs relating to a single backpack are given below: Standard Quantity Standard Price Standard or Rate Direct materials Direct labor $6.00 per yard per direct labor. Variable manufacturing overhead Total standard cost per unit Overhead is applied to production on the basis of direct labor-hours. During March, 520 backpacks were manufactured and sold. Selected information relating to the month's production is given below. Materials Direct Labor...
Highland Company produces a lightweight backpack that is popular with college students. Standard variable costs relating to a single backpack are given below: Standard Quantity or Hours Standard Price or Rate $8.00 per yard Standard Cost Direct materials Direct labor per direct labor- 2 hour $ Variable manufacturing overhead Total standard cost per unit Overhead is applied to production on the basis of direct labor-hours. During March, 600 backpacks were manufactured and sold. Selected information relating to the month's production...