Kropf Inc. 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 Direct materials Standard Price or Rate $ 7.30 per liter $24.70 per hour $ 6.20 per hour 7.70 liters Direct labor 0.50 hours Variable manufacturing overhead 0.50 hours The company has reported the following actual results for the product for September: Actual output Raw materials purchased Actual cost of raw materials purchased Raw materials used in production Actual direct labor-hours 9,900 units 76,500 liters $585,500 76,240 liters 4,650 hours $120,302 $ 23,614 Actual direct labor cost Actual variable overhead cost Required: a. Compute the materials price variance for September. b. Compute the materials quantity variance for September. c. Compute the labor rate variance for September. d. Compute the labor efficiency variance for September. e. Compute the variable overhead rate variance for September. f. Compute the variable overhead efficiency variance for September. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) a. Materials price variance b. Materials quantity variance C. Labor rate variance d. Labor efficiency variance e. Variable overhead rate variance f. Variable overhead efficiency variance
Kropf Inc. 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 Direct materials Standard Price or Rate $ 7.30 per liter $24.70 per hour $ 6.20 per hour 7.70 liters Direct labor 0.50 hours Variable manufacturing overhead 0.50 hours The company has reported the following actual results for the product for September: Actual output Raw materials purchased Actual cost of raw materials purchased Raw materials used in production Actual direct labor-hours 9,900 units 76,500 liters $585,500 76,240 liters 4,650 hours $120,302 $ 23,614 Actual direct labor cost Actual variable overhead cost Required: a. Compute the materials price variance for September. b. Compute the materials quantity variance for September. c. Compute the labor rate variance for September. d. Compute the labor efficiency variance for September. e. Compute the variable overhead rate variance for September. f. Compute the variable overhead efficiency variance for September. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) a. Materials price variance b. Materials quantity variance C. Labor rate variance d. Labor efficiency variance e. Variable overhead rate variance f. Variable overhead efficiency variance
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Kropf Inc. 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
$ 7.30 per liter
$24.70 per hour
$ 6.20 per hour
7.70 liters
Direct labor
0.50 hours
Variable manufacturing overhead
0.50 hours
The company has reported the following actual results for the product for September:
Actual output
Raw materials purchased
Actual cost of raw materials purchased
Raw materials used in production
9,900 units
76,500 liters
$585,500
76,240 liters
4,650 hours
$120,302
$ 23,614
Actual direct labor-hours
Actual direct labor cost
Actual variable overhead cost
Required:
a. Compute the materials price variance for September.
b. Compute the materials quantity variance for September.
c. Compute the labor rate variance for September.
d. Compute the labor efficiency variance for September.
e. Compute the variable overhead rate variance for September.
f. Compute the variable overhead efficiency variance for September.
(Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero
variance). Input all amounts as positive values.)
a. Materials price variance
b. Materials quantity variance
C.
Labor rate variance
d. Labor efficiency variance
e.
Variable overhead rate variance
f.
Variable overhead efficiency variance
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