Stellar Manufacturing has a standard of 2.5 pounds of raw material per unit, at $8 per pound. During June, they produced 1,500 units and used 3,900 pounds of materials at a total cost of $31,200. Calculate Stellar's materials quantity variance. a. $800 U b. $1,200 F c. $1,600 U d. $400 F

Stellar Manufacturing has a standard of 2.5 pounds of raw material per unit, at $8 per pound. During June, they produced 1,500 units and used 3,900 pounds of materials at a total cost of $31,200. Calculate Stellar's materials quantity variance. a. $800 U b. $1,200 F c. $1,600 U d. $400 F

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter8: Standard Cost Accounting—materials, Labor, And Factory Overhead

Section: Chapter Questions

Problem 10E: Standard unit cost and journal entries The normal capacity of Algonquin Adhesives Inc. is 40,000...

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QUESTION 1 MacDowell Company manufactures 100 kg bags of fertilizer that have the following unit standard costs for direct materials and direct labour: Direct materials (100 kg @ $1.00 per kilogram) $100.00 Direct labour (0.5 hours at $24 per hour) 12.00 Total standard direct cost per 100 kg bag $112.00 The following activities were recorded for October: • 1,000 bags were manufactured. • 102,500 kg of materials costing $101,000 were purchased and used • $12,000 was paid for 475 hours of direct labour. Required: A. Compute the direct materials variances. B. Compute the direct labour variances. C. Give possible reasons for the occurrence of each of the preceding variances.
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A Company combines three types of materials to produce its product. For a 100-kilo batch, the standard cost for materials are as follows: Standard Quantity 60 kilos 36 kilos Standard Price Total Materials A Materials B P5.00 4.00 P300 144 24 kilos 120 kilos Materials C 3.00 72 P516 During August, the company produced 200 batches or 20,000 kilos of its product. Materials used for this production were: Quantity 12,600 kls 7,300 kls 4.700 kls 24,600 kilos Price Total Materials A Materials B P4.80 4.10 3.40 P60,480 P29,930 15.980 P106,390 Materials C Compute for the Materials Variance involving several materials combined in the production process.
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Activity Rates and Product Costs using Activity-Based Costing Lonsdale Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity costs and activity bases are as follows: Budgeted Activity Activity Cost Activity Base Casting $215,160 Machine hours Assembly 189,550 Direct labor hours Inspecting 30,520 Number of inspections Setup 39,730 Number of setups Materials handling 36,960 Number of loads Corporate records were obtained to estimate the amount of activity to be used by the two products. The estimated activity-base usage quantities and units produced follow: Activity Base Entry Dining Total Machine hours 5,180 4,600 9,780 Direct labor hours 4,460 6,690 11,150 Number of inspections 1,660 520 2,180 Number of setups 230 60 290 Number of loads 700 180 880 Units produced 10,400 5,200 15,600 a. Determine the activity rate for each activity. If required, round the rate to the…
[The following information applies to the questions displayed below.] A manufactured product has the following information for June. Standard Quantity and Cost Actual Results Direct materials 7 pounds @ $7 per pound 58,600 pounds @ $7.20 per pound Direct labor 2 DLH @ $16 per DLH 16,300 hours @ $16.50 per hour Overhead 2 DLH @ $12 per DLH $ 205,500 Units manufactured 8,300 units (1) Prepare the standard cost card showing standard cost per unit.(2) Compute total budgeted cost for June production.(3) Compute total actual cost for June production.(4) Compute total cost variance for June. Compute total budgeted cost for June production. Total budgeted (standard) cost Compute total actual cost for June production. Actual cost Compute total cost variance for June. (Indicate the effect of the variance by selecting…
Lucia Company has set the following standard cost per unit for direct materials and direct labor. Direct materials (14 pounds @ $5 per pound) Direct labor (3 hours @ $14 per hour) $ 70 42 During May the company incurred the following actual costs to produce 8,000 units. Direct materials (114,300 pounds @ $4.80 per pound) Direct labor (28,400 hours @ $14.10 per hour) $ 548,640 400,440 AR = Actual Rate SR = Standard Rate AQ = Actual Quantity SQ Standard Quantity AP = Actual Price SP=Standard Price AH = Actual Hours SH = Standard Hours (1) Compute the direct materials price and quantity variances. (2) Compute the direct labor rate variance and the direct labor efficiency variance. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the direct labor rate variance and the direct labor efficiency variance. Note: Indicate the effect of each variance by selecting favorable, unfavorable, or no variance. Round "Rate per hour" answers to 2 decimal…
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A company uses the following standard costs to produce a single unit of output. Direct materials 7 pounds at $0.90 per pound = $ 6.30 Direct labor 0.4 hour at $9.00 per hour = $ 3.60 Manufacturing overhead 0.4 hour at $4.20 per hour = $ 1.68 During the latest month, the company purchased and used 66,000 pounds of direct materials at a price of $1.30 per pound to produce 10,000 units of output. Direct labor costs for the month totaled $32,336 based on 3,760 direct labor hours worked. Variable manufacturing overhead costs incurred totaled $13,800 and fixed manufacturing overhead incurred was $20,000. Based on this information, the total direct materials variance for the month was: