Bandar Industries manufactures sporting equipment. One of the company's products is a football helmet that requires special plastic. During the quarter ending June 30, the company manufactured 3,400 helmets, using 2,108 kilograms of plastic. The plastic cost the company $16,021. According to the standard cost card, each helmet should require 0.56 kilograms of plastic, at a cost of $8.00 per kilogram. Required: 1. What is the standard quantity of kilograms of plastic (SQ) that is allowed to make 3,400 helmets? 2. What is the standard materials cost allowed (SQ x SP) to make 3,400 helmets? 3. What is the materials spending variance?
Bandar Industries manufactures sporting equipment. One of the company's products is a football helmet that requires special plastic. During the quarter ending June 30, the company manufactured 3,400 helmets, using 2,108 kilograms of plastic. The plastic cost the company $16,021. According to the standard cost card, each helmet should require 0.56 kilograms of plastic, at a cost of $8.00 per kilogram. Required: 1. What is the standard quantity of kilograms of plastic (SQ) that is allowed to make 3,400 helmets? 2. What is the standard materials cost allowed (SQ x SP) to make 3,400 helmets? 3. What is the materials spending variance?
Chapter1: Financial Statements And Business Decisions
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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Bandar Industries Exercise 10-1(Algo) Direct Materials Variances (LO10-1)
![Exercise 10-1 (Algo) Direct Materials Variances [LO10-1]
Bandar Industries manufactures sporting equipment. One of the company's products is a football helmet that requires special plastic.
During the quarter ending June 30, the company manufactured 3,400 helmets, using 2,108 kilograms of plastic. The plastic cost the
company $16,021.
According to the standard cost card, each helmet should require 0.56 kilograms of plastic, at a cost of $8.00 per kilogram.
Required:
1. What is the standard quantity of kilograms of plastic (SQ) that is allowed to make 3,400 helmets?
2. What is the standard materials cost allowed (SQ x SP) to make 3,400 helmets?
3. What is the materials spending variance?
4. What is the materials price variance and the materials quantity variance?
(For requirements 3 and 4, indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for
no effect (i.e., zero variance). Input all amounts as positive values. Do not round intermediate calculations.)
1.
Standard quantity of kilograms allowed
Standard cost allowed for actual output
Materials spending variance
Materials price variance
Materials quantity variance
2.
3.
4.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F43ee94ef-72d6-420b-afde-dad6101e81bf%2Fdda2171f-4161-44b7-97b2-7f3c325f7251%2Fymzyk1_processed.png&w=3840&q=75)
Transcribed Image Text:Exercise 10-1 (Algo) Direct Materials Variances [LO10-1]
Bandar Industries manufactures sporting equipment. One of the company's products is a football helmet that requires special plastic.
During the quarter ending June 30, the company manufactured 3,400 helmets, using 2,108 kilograms of plastic. The plastic cost the
company $16,021.
According to the standard cost card, each helmet should require 0.56 kilograms of plastic, at a cost of $8.00 per kilogram.
Required:
1. What is the standard quantity of kilograms of plastic (SQ) that is allowed to make 3,400 helmets?
2. What is the standard materials cost allowed (SQ x SP) to make 3,400 helmets?
3. What is the materials spending variance?
4. What is the materials price variance and the materials quantity variance?
(For requirements 3 and 4, indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for
no effect (i.e., zero variance). Input all amounts as positive values. Do not round intermediate calculations.)
1.
Standard quantity of kilograms allowed
Standard cost allowed for actual output
Materials spending variance
Materials price variance
Materials quantity variance
2.
3.
4.
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