Landkirk computes its overhead rates using practical volume, which is 3,400 units. The actual results for the year are as follows: ( SEE PICTURE ATTACHED) ADDITIONAL INFO Units produced: 3,100 Actual yield: 4,650 kg Direct materials purchased: Almond 2,800 kg @ P56.00; Chocolate 4,000 @ P57.00 Direct materials used: Almond 2,500 kg; Chocolate 3,600 kg Direct labor: Assembly 1,800 hours @ 40.00; Packaging 1,500 hours @ P40.00 Variable overhead: P65,000 Fixed overhead: P105,000 REQUIREMENTS Labor rate variance Labor efficiency variance Labor mix variance Labor yield variance Using the four-way variance analysis, the variable overhead spending variance Using the four-way variance analysis, the variable overhead efficiency variance Using the four-way variance analysis, the fixed overhead spending variance Using the four-way variance analysis, the volume overhead variance. Using the three-way variance analysis, the spending variance Using the two-way variance analysis, the controllable variance Using the two-way variance analysis, the uncontrollable variance.
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.
Landkirk computes its overhead rates using practical volume, which is 3,400 units. The actual results for the year are as follows:
( SEE PICTURE ATTACHED)
ADDITIONAL INFO
- Units produced: 3,100
- Actual yield: 4,650 kg
- Direct materials purchased: Almond 2,800 kg @ P56.00; Chocolate 4,000 @ P57.00
- Direct materials used: Almond 2,500 kg; Chocolate 3,600 kg
- Direct labor: Assembly 1,800 hours @ 40.00; Packaging 1,500 hours @ P40.00
- Variable overhead: P65,000
- Fixed overhead: P105,000
REQUIREMENTS
- Labor rate variance
- Labor efficiency variance
- Labor mix variance
- Labor yield variance
- Using the four-way
variance analysis , the variable overhead spending variance - Using the four-way variance analysis, the variable overhead efficiency variance
- Using the four-way variance analysis, the fixed overhead spending variance
- Using the four-way variance analysis, the volume overhead variance.
- Using the three-way variance analysis, the spending variance
- Using the two-way variance analysis, the controllable variance
- Using the two-way variance analysis, the uncontrollable variance.
![P.
P.
P.
SP
Usage
Standard Cost
Direct Material
Almond
0.75 kg
P.
37.50
Chocolate
1.25 kg
75.00
P.
Total
2.00 kg
112.50
P.
Direct Labor
Assembly
0.75 hour
30.00
00'0
P.
Packaging
0.25 hour
7.50
00'0
Total
1 hour
37.50
Overhead
Variable
20.00
1 hour
20.00
P.
Fixed
30.00
1 hour
30.00
P.
P.
Total
50.00
Total Cost per Unit
200.00](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F66e7868a-08b1-4427-a59c-5b414576c94e%2F0faff656-668b-43ee-bcdb-91e038af22a7%2Foapchxt_processed.jpeg&w=3840&q=75)
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