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Silicon Inc. has provided the following information for the year ended December 31, Year 1. Master Budget Actual Co...

Silicon Inc. has provided the following information for the year ended December 31, Year 1.

Master Budget Actual Costs
5,000 units 4,500 units
Direct materials $ 35,000 $ 32,500
Direct labor 15,000 12,500
Variable manufacturing overhead 8,000 7,800
Fixed manufacturing overhead 16,000 17,500
Total manufacturing cost $ 74,000 $ 70,300

Knowledge Check 01

What is the direct materials spending variance?

  • $1,000 favorable

  • $1,000 unfavorable

  • $3,500 favorable

  • $3,500 unfavorable

Knowledge Check 02

What is the direct labor volume variance?

  • $2,500 favorable

  • $2,500 unfavorable

  • $1,500 favorable

  • $1,500 unfavorable

Knowledge Check 03

What is the total variable manufacturing overhead variance?

  • $200 favorable

  • $200 unfavorable

  • $800 favorable

  • $800 unfavorable

Knowledge Check 04

What is the fixed manufacturing overhead volume variance?

  • $1,600 favorable

  • $3,100 unfavorable

  • $150 unfavorable

  • $0

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Answer #1

Answer is given below

1. Direct Material spending variance $1,000 Unfavourable Master Budget Direct Material Total Units $35,000 5,000 $7.00 Standa

$1,000 Unfavourable Direct Material spending variance 1. Master Budget Direct Material Total Units $35,000 5,000 $7.00 Standard for actual Actual Direct Material $31,500 $32,500 $1,000 Unfavourable Variance $1,500 Favourable Direct labor volume variance 2. Master Budget $15,000 5,000 Direct Labor $3.00 Total Units Difference in volume Variance 500 1,500 Favourable $200 Favourable Total variable manufacturing overhead variance 3. (Master Budget- Actual Costs) $1,600 favourable Fixed Manufacturing overhead volume variance 4. Master Budget Fixed Manufacturing Cost $16,000 5,000 $3.20 Output Difference in volume 500 1,600 Favourable Variance

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