Question

PART 6 Standard Job Order Costing Variance Analys is Special order lamps are manufactured in division S. Because of the precise nature of the process a standard cost system has been developed. The following standards are used for the special orders: Standards $16.000000 per lamp 2.400000 per lamp (4 lamps/hr.) 0.250000 per lamp (4 lamps/hr.) 10.000000 per lamp S 28.650000 Lamp Kits Direct Labor Variable Overhead *Fixed Overhead Total *Fixed overhead is based on expected production of 4,014 customized each month. To keep records of the actual cost of a job, a Job Order Cost System has been developed. Entries are made to the Job Order System at actual cost (overhead is applied based on actual labor hours while entries are made to the accounting system at standard. Variance analysis is used to analyze the differences Job Order Costing Section On January 1, 20x2, Division S be gan Job 1101 for the Client, THE BIG CHILDREN STORE. The job called for 4,000 customized lamps. The following set of transactions occurred from January 5 until the job was completed: 5-Jan Purchased 4,200 Lamp Kits @ $16.25 per kit 9-Jan 4,050 sets of Lamp Kits were requisitioned. 17-Jan Payroll of 630 Direct Labor Hours @ $9.55 per hour. 30-Jan Payroll of 680 Direct Labor Hours @ $9.80 per hour 30-Jan 3,986 lamps were completed and shipped. All materials requisitioned were used or scrapped Month End Overhead Information 1,336.20 S 41,123.45 Actual Variable Overhead S Actual Fixed Overhead

Answer 1

Answer is given below with all working

Lamps competed 3,986 Total Material price Variance $1,050 Unfavourable Material usage vairance $1,024 Unfavourable Direct Labor Efficiency variance | Direct Labor rate variance $3,010 (Unfavourable $105 Unfavourable Working note Direct Material Price Variance = ( Standard Rate - Actual Rate) * Actual Quantity Direct Material Quantity Variance = (Standard Quantity for Actual production - Actual Quantity) * Standard Rate Working note Actual price Actual Quantity Standard Actual Rate Actual Quantity Standard cost Standard Quantity Standard Rate $16.25 4,050 $68,250 Actual Qty at Standard rate (consumed) $16.00 3,986 $64,800 Standard Qty at Std rate 4,200 Actual Quantity at Actual Rate (Purchased) Direct Material price variance $16.00 $63,776 Direct Material Quantity variance $1,050 Unfavourable $1,024 Unfavourable Total Direct Material cost Variance $2,074 Unfavourable Direct Labor Variance Direct Labor Rate Variance = ( Standard Rate - Actual Rate) * Actual hours Direct Labor Efficiency Variance = ( Standard hours for Actual production - Actual hours) * Standard Rate Working note Actual price Actual Rate Standard Rate Standard cost Standard 1 hours Standard Rate Actual Hours Actual Hours 1,310 Actual labor hours at actual rate $9.68 1,310 $12,681 Actual labor hours at std rate $9.60 996.50 $12,576 Standard hours at std rate $9.60 $9,566 Direct Labor Rate Variance Direct Labor Efficiency Variance -$104.50 Unfavourable $3,009.60 Unfavourable Total Direct Labor Cost variance $3,114.10 Unfavourable