New Jersey Valve Company manufactured 8,300 units during January of a control valve used by milk processors in its Camden plant. Records indicated the following: Direct labor Direct material purchased Direct material used The control valve has the following standard prime costs: Direct material Direct labor Standard prime cost per unit 51,100 hour at $14.30 per hour 27,000 pounds at $3.50 per pound 24,600 pounds Required 1 Required 2 3 pounds at $3.40 per pound 6 hour at $14.70 per hour Required: 1. Prepare a schedule of standard production costs for January, based on actual production of 8,300 units. 2. For the month of January, compute the following variances. Complete this question by entering your answers in the tabs below. Direct material Direct labor Total standard production costs Prepare a schedule of standard production costs for January, based on actual production of 8,300 units. NEW JERSEY VALVE COMPANY: CAMDEN PLANT Schedule of Standard Production Costs Based on 8,300 Units For the Month of January Standard Costs $ $ 10.20 88.20 $98.40 < Required 1 0 Required 2 >
New Jersey Valve Company manufactured 8,300 units during January of a control valve used by milk processors in its Camden plant. Records indicated the following: Direct labor Direct material purchased Direct material used The control valve has the following standard prime costs: Direct material Direct labor Standard prime cost per unit 51,100 hour at $14.30 per hour 27,000 pounds at $3.50 per pound 24,600 pounds Required 1 Required 2 3 pounds at $3.40 per pound 6 hour at $14.70 per hour Required: 1. Prepare a schedule of standard production costs for January, based on actual production of 8,300 units. 2. For the month of January, compute the following variances. Complete this question by entering your answers in the tabs below. Direct material Direct labor Total standard production costs Prepare a schedule of standard production costs for January, based on actual production of 8,300 units. NEW JERSEY VALVE COMPANY: CAMDEN PLANT Schedule of Standard Production Costs Based on 8,300 Units For the Month of January Standard Costs $ $ 10.20 88.20 $98.40 < Required 1 0 Required 2 >
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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:New Jersey Valve Company manufactured 8,300 units during January of a control valve used by milk processors in its Camden plant.
Records indicated the following:
Direct labor
Direct material purchased
Direct material used
The control valve has the following standard prime costs:
Direct material
Direct labor
Standard prime cost per unit
51,100 hour at $14.30 per hour
27,000 pounds at $3.50 per pound
24,600 pounds
Required 1 Required 2
3 pounds at $3.40 per pound
6 hour at $14.70 per hour
Required:
1. Prepare a schedule of standard production costs for January, based on actual production of 8,300 units.
2. For the month of January, compute the following variances.
Complete this question by entering your answers in the tabs below.
Prepare a schedule of standard production costs for January, based on actual production of 8,300 units.
NEW JERSEY VALVE COMPANY: CAMDEN PLANT
Schedule of Standard Production Costs
Direct material
Direct labor
Total standard production costs
Based on 8,300 Units
For the Month of January
Standard Costs
$
$10.20
88.20
$98.40
< Required 1
0
Required 2 >
Transcribed Image Text:Required 1 Required 2
For the month of January, compute the following variances.
Note: Indicate the effect of each variance by selecting "Favorable" or "Unfavorable". Select "None" and enter "0" for no effect
(i.e., zero variance).
Direct-material price variance
Direct-material quantity variance
Direct-material purchase price variance
Direct-labor rate variance
Direct-labor efficiency variance
< Required 1
Required 2 >
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