Question

1)

Rip Tide Company manufactures surfboards. Its standard cost information follows: Standard Standard Price (Rate) $ 5 per sq. ft. $14 per hr. Standard Unit Cost $ 75.00 130.20 Quantity 15 sq. ft. 9.3 hrs. Direct materials (fiberglass) Direct labor Variable manufacturing overhead (based on direct labor hours) Fixed manufacturing overhead ($35,000 + 260 units) 46.50 $5 per hr. 9.3 hrs. 134.62 Rip Tide has the following actual results for the month of June: Number of units produced and sold Number of square feet of fiberglass used Cost of fiberglass used Number of labor hours worked Direct labor cost Variable overhead cost Fixed overhead cost 180 6,000 $33,600 1,584 $23,285 s 7,128 $26,500

2)

Answer 1

Material Price variance = Actual quantity * (Standard Rate - Actual Rate) = 6000 * (5 - 33600 / 6000) = -3600

Material Quantity variance = Standard rate * (Standard Quantity - Actual Quantity) = 5 * (15 * 180 - 6000) = -16500

Direct Labour Price variance = Actual quantity * (Standard Rate - Actual rate) = 1584 * (14 - 23285 / 1584) = -1109

Direct Labour Quantity variance = Standard rate * (Standard Quantity - Actual Quantity) = 14 * (1674 - 1584) = +1260

Journal Entries:

Material account Debit 13500

Material price variance account Debit 3600

Material quantity variance account Debit 16500

Accounts Payable account Credit 33600

Work in process inventory account Debit 23436

Direct Labour Price variance account Debit 1109

Direct Labour Quantity variance account Credit 1260

Wages payable account Credit 23285

Only the first question is answered thoroughly. The second question can be answered in the same manner. HOMEWORKLIB RULES provides for answering first question only in multiple questions.