m Really Cold Coat Company does not expect there to be any beginning ventories of filler and lining material. At the end of the budget year, I'm oat Company experienced the following actual results: Actual production Filler Liner Women's contr Women's Coats 4,400 Actual Price per Unit $1.90 per lb. 8.20 per yd. Actual Labor Rate $1410 por br Men's Coats 5,800 Actual Quantity Purchased and 48,000 85,100 Actual Labor Hours Used 1875
m Really Cold Coat Company does not expect there to be any beginning ventories of filler and lining material. At the end of the budget year, I'm oat Company experienced the following actual results: Actual production Filler Liner Women's contr Women's Coats 4,400 Actual Price per Unit $1.90 per lb. 8.20 per yd. Actual Labor Rate $1410 por br Men's Coats 5,800 Actual Quantity Purchased and 48,000 85,100 Actual Labor Hours Used 1875
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
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.
Topic Video
Question
PR23 2B
this is a practice problem with two parts
Transcribed Image Text:1. a.
Direct Materials Variance
Price variance:
Actual price
Standard price
Variance
Actual quantity
Direct materials price variance (favorable) unfavorable
Quantity variance:
Actual quantity used (lbs.)
Standard quantity used (lbs.)
Variance (lbs.)
Standard price
Direct materials quantity variance (favorable) unfavorable
Total direct materials cost variance (favorable) unfavorable
Total direct materials cost variance:
Actual cost
Standard cost
Total direct materials cost variance (favorable) unfavorable
Supporting calculations:
Standard quantity used of filler:
Coats produced
Standard amount per coat (lbs.)
Total
Standard quantity used of liner:
Coats produced
Standard amount per coat (yds.)
Total
Filler
Womens
Liner
Men's
Total
Total
b.
Direct Labor Variance
Rate variance:
Actual rate
Standard rate
Variance
Actual time
Direct labor rate variance (favorable) unfavorable
Time variance
Actual tiime
Standard time
Variance
Standard rate
Direct labor time variarce (favorable) unfavcrable
Total direct labor cost variance (favorable) unfavorable
Total direct labor cost variance:
Actual cost
Standard cost
Total direct labor cost variance (favorable) unfavorable
Women's
Coats
Men's
Coats
Total
Transcribed Image Text:I'm Really Cold Coat Company makes women's and men's coats. Both
products require filler and lining material. The following planning
information has been made available:
Filler
Liner
Standard labor time
Planned production
Standard labor rate
Actual production
Filler
Liner
Standard Amount per Unit
Women's coats
Men's coats
Women's Coats
4.0 lb.
7.0 yds.
0.40 hr.
Women's Coats
5,000 units
$14.00 per hr.
Men's Coats
5.2 lb.
9.4 yds.
Women's Coats
4,400
Actual Price per Unit
$1.90 per lb.
8.20 per yd.
Actual Labor Rate
I'm Really Cold Coat Company does not expect there to be any beginning or ending
inventories of filler and lining material. At the end of the budget year, I'm Really Cold
Coat Company experienced the following actual results:
$14.10 per hr.
13.30 per hr.
0.50 hr.
®
Excel
Standard Price per Unit
$2.00 per lb.
8.00 per yd.
Men's Coats
6,200 units
$13.00 per hr.
Men's Coats
5,800
Actual Quantity Purchased and Used
48,000
85,100
Actual Labor Hours Used
1,825
2,800
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