! Required Information [The following Information applies to the questions displayed below.] Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct labor-hours and its standard cost card per unit is as follows: Direct materials: 5 pounds at $9 per pound Direct labor: 3 hours at $14 per hour Variable overhead: 3 hours at $8 per hour Total standard cost per unit $ 45 42 24 $ 111 The planning budget for March was based on producing and selling 28,000 units. However, during March the company actually produced and sold 34,000 units and incurred the following costs: a. Purchased 180,000 pounds of raw materials at a cost of $8.50 per pound. All of this material was used in production. b. Direct laborers worked 69,000 hours at a rate of $15 per hour. c. Total variable manufacturing overhead for the month was $565,110.
! Required Information [The following Information applies to the questions displayed below.] Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct labor-hours and its standard cost card per unit is as follows: Direct materials: 5 pounds at $9 per pound Direct labor: 3 hours at $14 per hour Variable overhead: 3 hours at $8 per hour Total standard cost per unit $ 45 42 24 $ 111 The planning budget for March was based on producing and selling 28,000 units. However, during March the company actually produced and sold 34,000 units and incurred the following costs: a. Purchased 180,000 pounds of raw materials at a cost of $8.50 per pound. All of this material was used in production. b. Direct laborers worked 69,000 hours at a rate of $15 per hour. c. Total variable manufacturing overhead for the month was $565,110.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Munabhai
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Required Information
[The following Information applies to the questions displayed below.]
Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct
labor-hours and its standard cost card per unit is as follows:
Direct materials: 5 pounds at $9 per pound
Direct labor: 3 hours at $14 per hour
Variable overhead: 3 hours at $8 per hour
Total standard cost per unit
$ 45
42
24
$ 111
The planning budget for March was based on producing and selling 28,000 units. However, during March the company
actually produced and sold 34,000 units and incurred the following costs:
a. Purchased 180,000 pounds of raw materials at a cost of $8.50 per pound. All of this material was used in production.
b. Direct laborers worked 69,000 hours at a rate of $15 per hour.
c. Total variable manufacturing overhead for the month was $565,110.
5. If Preble had purchased 184,000 pounds of materials at $8.50 per pound and used 180,000 pounds in production, what would be
the materials price variance for March?
Note: Indicate the effect of each varlance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (l.e., zero
variance.). Input all amounts as positive values.
Materials price variance](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff9a845d5-159d-4652-abb7-fee260f98dea%2F744ba9c0-3697-4c68-bfc7-d3cdd9491701%2Flybt01f_processed.jpeg&w=3840&q=75)
Transcribed Image Text:!
Required Information
[The following Information applies to the questions displayed below.]
Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct
labor-hours and its standard cost card per unit is as follows:
Direct materials: 5 pounds at $9 per pound
Direct labor: 3 hours at $14 per hour
Variable overhead: 3 hours at $8 per hour
Total standard cost per unit
$ 45
42
24
$ 111
The planning budget for March was based on producing and selling 28,000 units. However, during March the company
actually produced and sold 34,000 units and incurred the following costs:
a. Purchased 180,000 pounds of raw materials at a cost of $8.50 per pound. All of this material was used in production.
b. Direct laborers worked 69,000 hours at a rate of $15 per hour.
c. Total variable manufacturing overhead for the month was $565,110.
5. If Preble had purchased 184,000 pounds of materials at $8.50 per pound and used 180,000 pounds in production, what would be
the materials price variance for March?
Note: Indicate the effect of each varlance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (l.e., zero
variance.). Input all amounts as positive values.
Materials price variance
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