Delta Products prepares its budgets on the basis of standard costs. A responsibility report is prepared monthly showing thedifferences between master budget and actual results. Variances are analyzed and reported separately. There are no materialsinventories.The following information relates to the current period:Standard costs (per unit of output)Direct materials, 7 gallons @ $4.00 per gallonDirect labor, 5.00 hours @ $44.00 per hourFactory overheadVariable (25% of direct labor cost)$ 2822055Total standard cost per unit$ 303Actual costs and activities for the month follow:16,020 gallons at $1.98 per gallon2,060 units5,700 hours at $41.80 per hour$58, 200Materials usedOutputActual labor costsActual variable overheadRequired:Prepare a cost variance analysis for the variable costs. (Enter your final answers as a whole number. Do not round intermediatecalculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do notselect either option.) Direct materials:Price varianceEfficiency varianceDirect materials cost varianceDirect labor:Price varianceEfficiency varianceDirect labor cost varianceVariable overhead:Price varianceEfficiency varianceVariable overhead cost variance

Name: Delta Products prepares its budgets on the basis of standard costs. A
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Description: Delta Products prepares its budgets on the basis of standard costs. A responsibility report is prepared monthly showing thedifferences between master budget and actual results. Variances are analyzed and reported separately. There are no materialsin

Solution: Introduction: Under the standard Costing method, standard cost is a predetermined cost and…

Business

Accounting

Delta Products prepares its budgets on the basis of standard costs. A responsibility report is prepared monthly showing the differences between master budget and actual results. Variances are analyzed and reported separately. There are no materials inventories. The following information relates to the current period: Standard costs (per unit of output) Direct materials, 7 gallons @ $4.00 per gallon Direct labor, 5.00 hours @ $44.00 per hour Factory overhead Variable (25% of direct labor cost) $ 28 220 55 Total standard cost per unit $ 303 Actual costs and activities for the month follow: Materials used 16,020 gallons at $1.98 per gallon 2,060 units 5,700 hours at $41.80 per hour $58, 200 Output Actual labor costs Actual variable overhead Required: Prepare a cost variance analysis for the variable costs. (Enter your final answers as a whole number. Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do n select either option.)

Delta Products prepares its budgets on the basis of standard costs. A responsibility report is prepared monthly showing the differences between master budget and actual results. Variances are analyzed and reported separately. There are no materials inventories. The following information relates to the current period: Standard costs (per unit of output) Direct materials, 7 gallons @ $4.00 per gallon Direct labor, 5.00 hours @ $44.00 per hour Factory overhead Variable (25% of direct labor cost) $ 28 220 55 Total standard cost per unit $ 303 Actual costs and activities for the month follow: Materials used 16,020 gallons at $1.98 per gallon 2,060 units 5,700 hours at $41.80 per hour $58, 200 Output Actual labor costs Actual variable overhead Required: Prepare a cost variance analysis for the variable costs. (Enter your final answers as a whole number. Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do n select either option.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Taft Corporation uses a standard costing system in which variable manufacturing overhead is assigned to production on the basis of machine hours. The following data pertain to one month's operations: Variable manufacturing overhead cost incurred: Total flexible budget variable overhead cost: Standard machine hours allowed for actual production: $68,000 $74,550 3,550 MHs 3,000 MHs Actual machine hours incurred: 9 The variable overhead rate variance is: А. $6,550 Favorable $6,550 Unfavorable $5,000 Favorable В. С. D. $5,000 Unfavorable Е. None of the above
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A company has the following information for the month of October. The company applies overhead (OH) costs using standard machine hours as the allocation base. Actual Results Actual variable OH costs Actual fixed OH costs Actual machine hours Actual output Budget (for 1,000 units) Variable OH Fixed OH Budgeted machine hours Q. What $360 Favorable $2,500 $4,700 $1,280 MHS 1,100 units Q. What was the company's VOH efficiency variance for October? Answer. (Click to select) (Click to select) None of the answers are correct $180 Unfavorable Answer. $360 Unfavorable $180 Favorable $2,000 $4,400 1,000 MHS ume variance for October? 4
The following standard costs were used for one of its products: Standard Cost per Unit Fixed overhead Total 9 hours @ $13 per hour $ 117 Overhead is applied to products on the basis of standard direct labor hours for actual production. The following information is available regarding the company's operations for the period: Actual units produced Total actual direct labor hours Actual fixed manufacturing overhead incurred Budgeted fixed manufacturing overhead for the period Budgeted units for the period Required: Calculate the fixed overhead variances. Use your answer to answer the following questions. 1,200 units 8,500 hours $110,000 $122,850 1,050 units
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