Dirickson Incorporated has provided the following data concerning one of the products in its standard cost system. Variable manufacturing overhead is applied to products on the basis of direct labor-hours. Standard Quantity or Hours per Unit of Output Inputs Standard Price or Rate Direct materials 7.6 ounces $ 9.40 per ounce Direct labor 0.10 hours $ 18.00 per hour $ 5.30 per hour Variable manufacturing overhead 0.10 hours The company has reported the following actual results for the product for July: Actual output 7,600 units Raw materials purchased 63,000 ounces $ 541,800 Actual cost of raw materials purchased Raw materials used in production 57,750 ounces Actual direct labor-hours 820 hours $ 16,072 $ 4,592 Actual direct labor cost Actual variable overhead cost The labor efficiency variance for the month is closest to:

Dirickson Incorporated has provided the following data concerning one of the products in its standard cost system. Variable manufacturing overhead is applied to products on the basis of direct labor-hours. Standard Quantity or Hours per Unit of Output Inputs Standard Price or Rate Direct materials 7.6 ounces $ 9.40 per ounce Direct labor 0.10 hours $ 18.00 per hour $ 5.30 per hour Variable manufacturing overhead 0.10 hours The company has reported the following actual results for the product for July: Actual output 7,600 units Raw materials purchased 63,000 ounces $ 541,800 Actual cost of raw materials purchased Raw materials used in production 57,750 ounces Actual direct labor-hours 820 hours $ 16,072 $ 4,592 Actual direct labor cost Actual variable overhead cost The labor efficiency variance for the month is closest to:

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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Henry Company has established the following standards for the costs of one unit of its product. The standard production overhead costs per unit are based on direct-labor hours. Calculation for standard per unit cost is as follows: Std Cost Std Qty Std Price/Rate Direct Material $ 14.40 6.00 kg $ 2.40/kg Direct Labor $ 3.00 0.40 hour $ 7.50/hour Variable Overhead $ 4.00 0.40 hour $ 10.00/hour Fixed Overhead* $ 4.80 0.40 hour $ 12.00/hour Total $ 26.20 *based on practical capacity of 2,500 direct-labor hour per month During December 2020, Henry purchased 30,000 kg of direct material at a total cost of $75,000. The total wages for December were $20,000, 75% of which were for direct labor. Henry manufactured 4,500 units of product during December 2020, using 28,000kg of the direct material purchased in December and 2,100 direct-labor hours. Actual variable and fixed overhead cost were $23,100 and $25,000, respectively.…
Vitex, Inc. manufactures a popular consumer product and it has provided the following data excerpts from its standard cost system: Inputs (1)StandardQuantityor Hours (2)StandardPriceor Rate StandardCost(1) × (2) Direct materials 6 pounds $3 per pound $ 18.00 Direct labor 0.8 hours $15 per hour 12.00 Variable manufacturing overhead 0.8 hours $3 per hour 2.40 Total standard cost per unit $32.40 TotalStandardCost* Variances Reported Priceor Rate Quantity orEfficiency Direct materials $405,000 $6,900 F $9,000 U Direct labor $ 270,000 $14,550 U $21,000 U Variable manufacturing overhead $54,000 $1,300 F $? U *Applied to Work in Process during the period. The company’s manufacturing overhead cost is applied to production on the basis of direct labor-hours. All of the materials purchased during the period were used in production. Work in process inventories are insignificant and can be ignored. Required: How many units were produced last…
The following are standard costs related to a product of Jacobs, SRL: Inputs: Unit of Input Units per item Price or rate Direct Materials: square feet 80 $22/square foot Direct Labor: direct labor hours 24 $38/direct labor hour Variable Overhead: direct labor hours $49/direct labor hour The company applies variable overhead on the basis of direct labor hours. In April, the following results were reported: Actual output: 506 items Raw Materials used: 45,684 square feet Raw Material purchased: 42,335 square feet Actual direct labor hours: 14,168 hours Actual cost of raw materials purchased: $973,705 Actual direct labor cost: $609,224 Actual variable overhead cost: $665,896 The direct material purchases variance is computed when the materials are purchased. Determine each of the following variances and whether they are favorable or unfavorable: Part 1: Direct Material quantity variance: 114,488 Unfavorable 114,488 Favorable 83,145 Favorable 83, 145…
Hakara Company has been using direct labor costs as the basis for assigning overhead to its many products. Under this allocation system, product A has been assigned overhead of $26.87 per unit, while product B has been assigned $7.62 per unit. Management feels that an ABC system will provide a more accurate allocation of the overhead costs and has collected the following cost pool and cost driver information: Cost Pools Activity Costs $ 415,000 120,000 44,000 The following cost information pertains to the production of A and B, just two of Hakara's many products: Machine setup Materials handling Electric power Number of units produced Direct materials cost Direct labor cost Number of setup hours Pounds of materials used Kilowatt-hours Product A Product B A 5,000 $ 22,000 $ 39,000 Cost per Unit Cost Drivers Setup hours Pounds of materials Kilowatt-hours 200 2,000 4,000 B 20,000 $ 26,000 $ 37,000 Activity Driver Consumption 5,000 15,000 22,000 200 2,000 4,000 Required: 1. Use…
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Rardin Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Direct materials 7.4 ounces Direct labor 0.3 hours Variable overhead 0.3 hours The company reported the following results concerning this product in July. Actual output Raw materials used in production Purchases of raw materials Actual direct labor-hours Actual cost of raw materials purchases Actual direct labor cost Actual variable overhead cost The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. Required: b. Compute the materials price variance. Do not indicate whether Favorable or Unfavorable. $8.00 per ounce $16.00 per hour $7.00 per hour 2,200 units 16,420 ounces 17,900 ounces 720 hours $141,410 $12,528 $5,112
Fluegge Incorporated has provided the following data concerning one of the products in its standard cost system. Variable manufacturing overhead is applied to products on the basis of direct labor-hours. Inputs Standard Quantity or Hours per Unit of Output Standard Price or Rate Direct materials 5.7 liters $ 5.40 per liter Direct labor 0.70 hours $ 20.60 per hour Variable manufacturing overhead 0.70 hours $ 5.50 per hour The company has reported the following actual results for the product for December: Actual output 4,100 units Raw materials purchased 25,100 liters Actual price of raw materials $ 4.80 per liter Actual cost of raw materials purchased $ 120,480 Raw materials used in production 23,360 liters Actual direct labor-hours 2,700 hours Actual direct labor rate $ 21.20 per hour Actual direct labor cost $ 57,240 Actual variable overhead rate $ 5.90 per hour Actual variable overhead cost $ 15,930 The raw materials price variance…
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