Sheridan Corporation accumulates the following data relative to jobs started and finished during the month of June 2025. Costs and Production Data Raw materials unit cost Raw materials units Direct labor payroll Direct labor hours Manufacturing overhead incurred Manufacturing overhead applied Machine hours expected to be used at normal capacity Budgeted fixed overhead for June Variable overhead rate per machine hour Fixed overhead rate per machine hour Actual $2.00 11,200 $177,310 14,900 $201,200 Standard $1.80 10,800 $170,240 15,200 $205,200 41,500 $62,250 $3 $1.50 Overhead is applied on the basis of standard machine hours. Three hours of machine time are required for each direct labor hour. The jobs were sold for $500,000. Selling and administrative expenses were $41,400. Assume that the amount of raw materials purchased equaled the amount used.
Sheridan Corporation accumulates the following data relative to jobs started and finished during the month of June 2025. Costs and Production Data Raw materials unit cost Raw materials units Direct labor payroll Direct labor hours Manufacturing overhead incurred Manufacturing overhead applied Machine hours expected to be used at normal capacity Budgeted fixed overhead for June Variable overhead rate per machine hour Fixed overhead rate per machine hour Actual $2.00 11,200 $177,310 14,900 $201,200 Standard $1.80 10,800 $170,240 15,200 $205,200 41,500 $62,250 $3 $1.50 Overhead is applied on the basis of standard machine hours. Three hours of machine time are required for each direct labor hour. The jobs were sold for $500,000. Selling and administrative expenses were $41,400. Assume that the amount of raw materials purchased equaled the amount used.
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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Transcribed Image Text:Sheridan Corporation accumulates the following data relative to jobs started and finished during the month of June 2025.
Costs and Production Data
Raw materials unit cost
Raw materials units
Direct labor payroll
Direct labor hours
Manufacturing overhead incurred
Manufacturing overhead applied
Machine hours expected to be used at normal capacity
Budgeted fixed overhead for June
Variable overhead rate per machine hour
Fixed overhead rate per machine hour
Actual
$2.00
11,200
$177,310
14,900
$201,200
Standard
$1.80
10,800
$170,240
15,200
$205,200
41,500
$62,250
$3
$1.50
Overhead is applied on the basis of standard machine hours. Three hours of machine time are required for each direct labor hour. The
jobs were sold for $500,000. Selling and administrative expenses were $41,400. Assume that the amount of raw materials purchased
equaled the amount used.
Transcribed Image Text:(a)
Compute all of the variances for (1) direct materials and (2) direct labor. (Round per unit values to 2 decimal places, e.g. 52.75 a
final answers to O decimal places, e.g. 52.)
(1)
(2)
Total materials variance
Materials price variance
Materials quantity variance
Total labor variance
Labor price variance
Labor quantity variance
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