Tharaldson Corporation makes a product with the following standard costs: Direct materials Direct labor Variable overhead Standard Quantity or Bours 5.4 ounces 0.5 hours 0.5 hours Standard Price or Rate $ 3.00 per ounce $ 12.00 per hour $9.00 per hour. The company reported the following results concerning this product in June. Originally budgeted output Actual output Raw materials used in production Purchases of raw materials Actual direct labor-hours Actual cost of raw materials purchases Actual direct labor cost Actual variable overhead cost. able overhead efficiency variance for June is: 4,200 units 4,200 units 20,000 ounces 21,000 ounces 560 hours $ 42,900 $ 14,200 $4,100 Standard Cost Per Unit $ 16.201 $ 6.00 $ 4.50 The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.
Tharaldson Corporation makes a product with the following standard costs: Direct materials Direct labor Variable overhead Standard Quantity or Bours 5.4 ounces 0.5 hours 0.5 hours Standard Price or Rate $ 3.00 per ounce $ 12.00 per hour $9.00 per hour. The company reported the following results concerning this product in June. Originally budgeted output Actual output Raw materials used in production Purchases of raw materials Actual direct labor-hours Actual cost of raw materials purchases Actual direct labor cost Actual variable overhead cost. able overhead efficiency variance for June is: 4,200 units 4,200 units 20,000 ounces 21,000 ounces 560 hours $ 42,900 $ 14,200 $4,100 Standard Cost Per Unit $ 16.201 $ 6.00 $ 4.50 The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased.
Chapter1: Financial Statements And Business Decisions
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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:Tharaldson Corporation makes a product with the following standard costs:
Direct materials
Direct labor
Variable overhead
Standard Quantity or
Bours
5.4 ounces
0.5 hours
0.5 hours
The company reported the following results concerning this product in June.
Originally budgeted output
Actual output
Raw materials used in production
Purchases of raw materials
Actual direct labor-hours
Actual cost of raw materials purchases
Actual direct labor cost
Actual variable overhead cost
Standard Price or Rate
$ 3.00 per ounce.
$12.00 per hour
$9.00 per hour
The variable overhead efficiency variance for June is:
4,200 units
4,200 units
20,000 ounces
21,000 ounces
560 hours
$ 42,900
$ 14,200
$4,100
Standard Cost
Per Unit
$ 16.201
$ 6.00
$ 4.50
The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is
computed when the materials are purchased.
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