Direct materials Direct labor Variable overhead Fixed overhead $ $ Price Variance 3,192 F 3,096 U Efficiency Variance 2,772 U 3,024 F S $ Production Volume Variance
Direct materials Direct labor Variable overhead Fixed overhead $ $ Price Variance 3,192 F 3,096 U Efficiency Variance 2,772 U 3,024 F S $ Production Volume Variance
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Concept explainers
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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Transcribed Image Text:Anthon Corporation has provided the following information regarding last month's activities.
Units produced (actual)
Master production budget
Direct materials
Direct labor
Overhead -
Standard costs per unit
Direct materials
Direct labor
Variable overhead
Actual costs
Direct materials purchased and used
Direct labor
Overhead
Direct materials
Direct labor
Variable overhead
Fixed overhead
Variable overhead is applied on the basis of direct labor-hours
Required:
Calculate all variable production cost price and efficiency variances and fixed production cost price and production volume variance
Note: Do not round intermediate calculations. Indicate the effect of each veriance by selecting "F" for favorable, or "U" for
unfavorable. If there is no effect, do not select either option.
$
$
Note: 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 not select either option.
Price Variance
3,192 F
3,096 U
10,500
$ 237,600
201,600.
267,000
$ 3.96 per liter x 5 liters per unit of output
$ 33.60 per hour x 0.5 hour per unit)
$ 28.50 per direct labor-hour
$
$ 207,480 (53,200 liters)
176,472 (5,160 hours).
272,000 (58% is variable)
$
Efficiency Variance
2,772 U
3,024 F
Production Volume
Variance.
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