Homework Help is Here – Start Your Trial Now!
Business
Accounting
Problems 1. Use the following standard cost card for 1 gallon of ice cream to answer the questions. Product: Gallon of Ice Cream Manufacturing Costs Direct Materials Cream Sugar Direct Labor Total Direct Costs ● Standard Cost Card Standard Quantity 5 quarts 16 ounces 3 minutes x Standard Cost per Unit $1.15 per quart $.08 per ounce $36.00 per hour Actual direct costs incurred to make 50 gallons of ice cream: 275 quarts of cream at $1.05 per quart 832 ounces of sugar at $0.075 per ounce 165 minutes of labor at $37 per hour All material used was bought during the current period. = Cost Summary $5.75 $1.28 $1.80 $8.83

Problems 1. Use the following standard cost card for 1 gallon of ice cream to answer the questions. Product: Gallon of Ice Cream Manufacturing Costs Direct Materials Cream Sugar Direct Labor Total Direct Costs ● Standard Cost Card Standard Quantity 5 quarts 16 ounces 3 minutes x Standard Cost per Unit $1.15 per quart $.08 per ounce $36.00 per hour Actual direct costs incurred to make 50 gallons of ice cream: 275 quarts of cream at $1.05 per quart 832 ounces of sugar at $0.075 per ounce 165 minutes of labor at $37 per hour All material used was bought during the current period. = Cost Summary $5.75 $1.28 $1.80 $8.83

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Topic Video
Question
**Problems** 1. Use the following standard cost card for 1 gallon of ice cream to answer the questions. **Standard Cost Card** | Product: Gallon of Ice Cream | | | | |------------------------------|--------|---------------------------|--------------------| | Manufacturing Costs | Standard Quantity | x Standard Cost per Unit | = Cost Summary | | Direct Materials | | | | | Cream | 5 quarts | $1.15 per quart | $5.75 | | Sugar | 16 ounces | $0.08 per ounce | $1.28 | | Direct Labor | 3 minutes | $36.00 per hour | $1.80 | | Total Direct Costs | | | $8.83 | **Actual direct costs incurred to make 50 gallons of ice cream:** - 275 quarts of cream at $1.05 per quart - 832 ounces of sugar at $0.075 per ounce - 165 minutes of labor at $37 per hour All material used was bought during the current period. **Questions:** a. Compute the material price, quantity, and total variances. b. Compute the labor price quantity, and total variances. c. What are possible causes of the material and labor variances with respect to the company?
Transcribed Image Text:**Problems** 1. Use the following standard cost card for 1 gallon of ice cream to answer the questions. **Standard Cost Card** | Product: Gallon of Ice Cream | | | | |------------------------------|--------|---------------------------|--------------------| | Manufacturing Costs | Standard Quantity | x Standard Cost per Unit | = Cost Summary | | Direct Materials | | | | | Cream | 5 quarts | $1.15 per quart | $5.75 | | Sugar | 16 ounces | $0.08 per ounce | $1.28 | | Direct Labor | 3 minutes | $36.00 per hour | $1.80 | | Total Direct Costs | | | $8.83 | **Actual direct costs incurred to make 50 gallons of ice cream:** - 275 quarts of cream at $1.05 per quart - 832 ounces of sugar at $0.075 per ounce - 165 minutes of labor at $37 per hour All material used was bought during the current period. **Questions:** a. Compute the material price, quantity, and total variances. b. Compute the labor price quantity, and total variances. c. What are possible causes of the material and labor variances with respect to the company?
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 4 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Performance measurements
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS