Required:1) Prepare a schedule of total standard manufacturing costs for the 24000 production of blocks in April 2021. 2) For the month of April, compute the following variances, indicating whether each is favourable (F) or unfavourable (U):a. Direct materials price variance (based on purchases) b. Direct materials efficiency variance InputCost/Block0.5 lb. @ $12/lb.$ 6.00Direct materialsDirect manufacturing labour1.4 hours @ $20/hour28.00Manufacturing overhead:Variable$6/lb. 0.5 Ib.3.00Fixed$15/lb. 0.3 lb.4.50Standard cost per block$41.50Actual results for April 2021 were as follows:Production24,000 blocksDirect materials purchased12,000 Ib. at $13/1lb.Direct materials used11,450 lb.Direct manufacturing labour38,000 hours for $798000Variable manufacturing overhead$68,150Fixed manufacturing overhead$155,000 Don Johnson is the management accountant for Cari-Blocks (CB), which manufacturesspecialty blocks. CB uses two direct cost categories: direct materials and directmanufacturing labour. Johnson feels that manufacturing overhead is most closely related tomaterial usage. Therefore, CB allocates manufacturing overhead to production based uponpounds of materials used.At the beginning of 2021, CB budgeted annual production of 200,000 blocks and adopted thefollowing standards for each block:

Standard costing is one of the important tool of management accounting, under which standard or…

Answered: Required: 1) Prepare a schedule of…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Concept explainers

Question

Required:
1) Prepare a schedule of total standard manufacturing costs for the 24000 production of blocks in April 2021.
2) For the month of April, compute the following variances, indicating whether each is favourable (F) or unfavourable (U):
a. Direct materials price variance (based on purchases)
b. Direct materials efficiency variance

Input
Cost/Block
0.5 lb. @ $12/lb.
$ 6.00
Direct materials
Direct manufacturing labour
1.4 hours @ $20/hour
28.00
Manufacturing overhead:
Variable
$6/lb. 0.5 Ib.
3.00
Fixed
$15/lb. 0.3 lb.
4.50
Standard cost per block
$41.50
Actual results for April 2021 were as follows:
Production
24,000 blocks
Direct materials purchased
12,000 Ib. at $13/1lb.
Direct materials used
11,450 lb.
Direct manufacturing labour
38,000 hours for $798000
Variable manufacturing overhead
$68,150
Fixed manufacturing overhead
$155,000

Don Johnson is the management accountant for Cari-Blocks (CB), which manufactures
specialty blocks. CB uses two direct cost categories: direct materials and direct
manufacturing labour. Johnson feels that manufacturing overhead is most closely related to
material usage. Therefore, CB allocates manufacturing overhead to production based upon
pounds of materials used.
At the beginning of 2021, CB budgeted annual production of 200,000 blocks and adopted the
following standards for each block:

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

Expert Solution

Step by step

Solved in 3 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

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.

Similar questions