E9-1 (Static) Calculating Unknown Values for Direct Materials, Direct Labor Variances [LO 9-3, 9-4) Ironwood Company manufactures cast-iron barbeque cookware. During a recent windstorm, it lost some of its cost accounting records Ironwood has managed to reconstruct portions of its standard cost system database but is still missing a few pieces of information. Required: Use the information in the table to determine the unknown amounts. You may assume that Ironwood does not keep any raw materials on hand Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (.e., zero variance) Standard amount per pan produced Standard price Actual amount used per pan produced Actual price Actual number of pans produced and sold Direct materials price variance Direct materials quantity variance Direct materials spending variance Direct labor rate variance Direct labor efficiency variance Direct labor spending variance Answer is not complete. Direct Materials 2.5 4.20 24 4.10 per pound 2.500 pans $ S $ S per poune pound 304 40 F O O Direct Labor hour per hour hour per hour pans $ 16.00 1.20 S 15.50 2.500 ww/w (80) U 20 F BOE 000
E9-1 (Static) Calculating Unknown Values for Direct Materials, Direct Labor Variances [LO 9-3, 9-4) Ironwood Company manufactures cast-iron barbeque cookware. During a recent windstorm, it lost some of its cost accounting records Ironwood has managed to reconstruct portions of its standard cost system database but is still missing a few pieces of information. Required: Use the information in the table to determine the unknown amounts. You may assume that Ironwood does not keep any raw materials on hand Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (.e., zero variance) Standard amount per pan produced Standard price Actual amount used per pan produced Actual price Actual number of pans produced and sold Direct materials price variance Direct materials quantity variance Direct materials spending variance Direct labor rate variance Direct labor efficiency variance Direct labor spending variance Answer is not complete. Direct Materials 2.5 4.20 24 4.10 per pound 2.500 pans $ S $ S per poune pound 304 40 F O O Direct Labor hour per hour hour per hour pans $ 16.00 1.20 S 15.50 2.500 ww/w (80) U 20 F BOE 000
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:E9-1 (Static) Calculating Unknown Values for Direct Materials, Direct Labor Variances (LO 9-3, 9-4)
Ironwood Company manufactures cast-iron barbeque cookware. During a recent windstorm, it lost some of its cost accounting
records. Ironwood has managed to reconstruct portions of its standard cost system database but is still missing a few pieces of
information.
Required:
Use the information in the table to determine the unknown amounts. You may assume that Ironwood does not keep any raw materials
on hand
Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (.e., zero
variance).
Standard amount per pan produced
Standard price
Actual amount used per pan produced
Actual price
Actual number of pans produced and sold
Direct materials price variance
Direct materials quantity variance
Direct materials spending variance
Direct labor rate variance
Direct labor efficiency variance
Direct labor spending variance
Answer is not complete.
Direct Materials
2.5
4.20
24
$
$
$
S
4.10
2.500
pound
per
pound
pound
per
pound
pans
(2) OU
40 F
00
Direct Labor
1.10
hour
$ 16.00
1.20
S 15.50
2.500
335
per hour
hour
per hour
pans
(80) U
200 F
BOU
000
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