Question 1Use the following standard cost card for 1gallon of ice cream to answer the questions.STANDARD COST CARDProduct: Gallon of Ice CreamManufacturingCost InformationStandardStandard CostCostQuantityper UnitSummaryDirect MaterialsCream5 quarts$1.15 per quart$0.08 per ounce$36.00 per hour$5.75$1.28SugarDirect Labor16 ounces3 minutes$1.80Total Direct Costs$8.83Actual direct costs incurred to make 50gallons of ice cream:275 quarts of cream at $1.05 per quart832 ounces of sugar at $0.075 perounce165 minutes of labor at $37 per hourAll material used was bought during thecurrent period.А.Compute the material and laborvariances.В.possible causes of the variances.Comment on the results and

Labour cost variance = Standard Cost - Actual Cost = (SRx SH) -(AHx AR)SR= Standard RateSH =…

STANDARD COST CARD Product: Gallon of Ice Cream Manufacturing Cost Information Standard Standard Cost Cost Quantity per Unit Summary Direct Materials Cream 5 quarts $5.75 $1.15 per quart s0.08 per ounce $36.00 per hour 16 ounces $1.28 Sugar Direct Labor 3 minutes $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. А. Compute the material and labor variances. В. Comment on the results and possible causes of the variances.

STANDARD COST CARD Product: Gallon of Ice Cream Manufacturing Cost Information Standard Standard Cost Cost Quantity per Unit Summary Direct Materials Cream 5 quarts $5.75 $1.15 per quart s0.08 per ounce $36.00 per hour 16 ounces $1.28 Sugar Direct Labor 3 minutes $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. А. Compute the material and labor variances. В. Comment on the results and possible causes of the variances.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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