Regent Corporation uses a standard cost system to account for the costs of its one product. Materials standards are 3 pounds of material at $14.00 per pound, and labor standards are 23 hours of labor at a standard wage rate of $91. During July, Regent Corporation produced 2.350 units. Materials purchased and used totaled 12,000 pounds at a total cost of $144,613. Payroll totaled $165,780 for 108,150 hours worked. Required: a. Calculate the direct materials price variance. Note: Do not round your intermediate calculations. Indicate the effect of variance by selecting "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance). b. Calculate the direct materials quantity variance. Note: Indicate the effect of variance by selecting "Favorable". "Unfavorable", or "None" for no effect (i.e., zero variance). Calculate the direct materials spending variance. c. Note: Indicate the effect of variance by selecting "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance). a. Price Variance b. Quantity Variance c. Spending Variance
Regent Corporation uses a standard cost system to account for the costs of its one product. Materials standards are 3 pounds of material at $14.00 per pound, and labor standards are 23 hours of labor at a standard wage rate of $91. During July, Regent Corporation produced 2.350 units. Materials purchased and used totaled 12,000 pounds at a total cost of $144,613. Payroll totaled $165,780 for 108,150 hours worked. Required: a. Calculate the direct materials price variance. Note: Do not round your intermediate calculations. Indicate the effect of variance by selecting "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance). b. Calculate the direct materials quantity variance. Note: Indicate the effect of variance by selecting "Favorable". "Unfavorable", or "None" for no effect (i.e., zero variance). Calculate the direct materials spending variance. c. Note: Indicate the effect of variance by selecting "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance). a. Price Variance b. Quantity Variance c. Spending Variance
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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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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![TB Problem 9-106 (Algo) [LO 9-3]
Regent Corporation uses a standard cost system to account for the costs of its one product. Materials standards are 3 pounds of
material at $14.00 per pound, and labor standards are 23 hours of labor at a standard wage rate of $9.1. During July, Regent
Corporation produced 2,350 units. Materials purchased and used totaled 12,000 pounds at a total cost of $144,613. Payroll totaled
$165,780 for 108,150 hours worked.
Required:
a. Calculate the direct materials price variance.
Note: Do not round your intermediate calculations. Indicate the effect of variance by selecting "Favorable", "Unfavorable", or
"None" for no effect (i.e., zero variance).
b. Calculate the direct materials quantity variance.
Note: Indicate the effect of variance by selecting "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance).
c. Calculate the direct materials spending variance.
Note: Indicate the effect of variance by selecting "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance).
a. Price Variance
b. Quantity Variance
c. Spending Variance](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fedf111bd-8104-414c-92c2-cbc9edca5ffc%2F9d2d68af-bf33-4650-8ddb-ef15abd05978%2F3vdtttt_processed.jpeg&w=3840&q=75)
Transcribed Image Text:TB Problem 9-106 (Algo) [LO 9-3]
Regent Corporation uses a standard cost system to account for the costs of its one product. Materials standards are 3 pounds of
material at $14.00 per pound, and labor standards are 23 hours of labor at a standard wage rate of $9.1. During July, Regent
Corporation produced 2,350 units. Materials purchased and used totaled 12,000 pounds at a total cost of $144,613. Payroll totaled
$165,780 for 108,150 hours worked.
Required:
a. Calculate the direct materials price variance.
Note: Do not round your intermediate calculations. Indicate the effect of variance by selecting "Favorable", "Unfavorable", or
"None" for no effect (i.e., zero variance).
b. Calculate the direct materials quantity variance.
Note: Indicate the effect of variance by selecting "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance).
c. Calculate the direct materials spending variance.
Note: Indicate the effect of variance by selecting "Favorable", "Unfavorable", or "None" for no effect (i.e., zero variance).
a. Price Variance
b. Quantity Variance
c. Spending Variance
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