Chapter 10 Mickey's Amusements Mickey's Amusements manufactures ride vehicles for roller coasters. One of their products is a seat with a harness for coasters that have inversions. Mickey's uses a standard cost system for all products. According to the standards set for the seat with a harness, the factory should work 1,100 hours each month to produce 2,200 seats. At the standard, each seat requires 3.0 sq. ft of material. The standard costs associated with this production are: Direct materials Direct labor Total $44,220 $6.70 per sq. ft. $6,600 $6.00 per hour Variable manufacturing OH (based on direct labor hours) $3,520 $3.20 per hour During January, the factory worked 1,000 direct labor hours and produced 2,200 seats. The following actual costs incurred during January are: Total Direct materials (7,400 sq. ft.) $40,700 Direct labor $8,140 Variable manufacturing OH (based on direct labor hours) $3,960 All materials purchased in January were used in production Calculate the following (be sure to label variances as F/U): 1) What is the materials price variance? AQ (AP-SP)
Chapter 10 Mickey's Amusements Mickey's Amusements manufactures ride vehicles for roller coasters. One of their products is a seat with a harness for coasters that have inversions. Mickey's uses a standard cost system for all products. According to the standards set for the seat with a harness, the factory should work 1,100 hours each month to produce 2,200 seats. At the standard, each seat requires 3.0 sq. ft of material. The standard costs associated with this production are: Direct materials Direct labor Total $44,220 $6.70 per sq. ft. $6,600 $6.00 per hour Variable manufacturing OH (based on direct labor hours) $3,520 $3.20 per hour During January, the factory worked 1,000 direct labor hours and produced 2,200 seats. The following actual costs incurred during January are: Total Direct materials (7,400 sq. ft.) $40,700 Direct labor $8,140 Variable manufacturing OH (based on direct labor hours) $3,960 All materials purchased in January were used in production Calculate the following (be sure to label variances as F/U): 1) What is the materials price variance? AQ (AP-SP)
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Transcribed Image Text:Chapter 10
Mickey's Amusements
Mickey's Amusements manufactures ride vehicles for roller coasters. One of their
products is a seat with a harness for coasters that have inversions.
Mickey's uses a standard cost system for all products. According to the standards
set for the seat with a harness, the factory should work 1,100 hours each month
to produce 2,200 seats. At the standard, each seat requires 3.0 sq. ft of material.
The standard costs associated with this production are:
Direct materials
Direct labor
Total
$44,220
$6.70 per sq. ft.
$6,600
$6.00 per hour
Variable manufacturing
OH
(based on direct labor
hours)
$3,520
$3.20 per hour
During January, the factory worked 1,000 direct labor hours and produced 2,200
seats.
The following actual costs incurred during January are:
Total
Direct materials (7,400
sq. ft.)
$40,700
Direct labor
$8,140
Variable manufacturing
OH
(based on direct labor
hours)
$3,960
All materials purchased in January were used in production
Calculate the following (be sure to label variances as F/U):
1) What is the materials price variance? AQ (AP-SP)
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