Question

Answer the next three questions using the following information 900 mpany produces a lightweigh table that is popular with college students. Filmow 900 tablets in March, but they ended up producing 920 tablets. migh table that wi ll . Filmore was planning to product listed bel a nd costing. Its standards of production MadMa t te planning) budget, and acrosse Filmore uses a standard costing. Its standar March Master Actual costs Standards Budget incurred Direct Materials $5.40 per yard 24.300 $23,050 Direct Labor ? per DLH S 20.250 $21,500 Variable MOH $2.00 per DLH $ 2,700. Fixed MOH S5.50 per DLH $7,800 Manufacturing overhead (MOI) is applied to production on the basis of direct labor-hours (DLHS). Scic relating to the month's production is given below: direct labor-hours (DLHs). Selected information 7,425 Actual direct labor-hours 1.400 DLHS The difference between standard and actual variable cost per tablet produced during March was $0.20 favorabi 16 Variable MOH rate variance is: A $40 Favorable $806 Unfavorable 5806 Favorable D. $766 Unfavorable E None of the above C. Direct labor wage efficiency variance is: $300 Unfavorable $550 Favorable $800 Favorable $500 Unfavorable None of the above

Answer 1

16. variable MOH rate variance

= actual cost - actual hours*standard rate

variable cost variance = 0.20$ favorable

variable cost are direct material labor and overhead

[24300+20250+2700]/900 - 0.2 =[23050+21500+x]/920

52.5-0.2=23050+21500+x /920

x=3566$

Actual variable oH is 3566$

variable MOH rate variance

= actual cost - actual hours*standard rate

variance = 3566 - (1400*2$)

3566-2800

=766$ unfavorable as the actual cost is more than standard

2.direct labor wage efficiency variance

standard rate (standard hours-actual hours)

standard hours = 2700variable OH / $2 rate per hour

=1350hours

standard labor rate= total cost/ hour

=20250/1350

=15$ per hour

standard rate (standard hours-actual hours)

standard hours for actual output = 1350/900 * 920units

=1380hours

variance = 15(1380-1400)

=300$ unfavorable