Tharaldson Corporation makes a product with the following standard costs: Direct materials Direct labor Variable overhead Multiple Choice O OO 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 $ 40,000 Actual direct labor cost $ 12,000 Actual variable overhead cost $ 3,000 The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. The labor efficiency variance for June is: ● $2,400 U $900 U $2,400 F Standard Quantity or Hours $900 F 6.6 ounces 0.3 hours. 0.3 hours Standard Price or Rate $ 3.00 per ounce $10.00 per hour $5.00 per hour. Standard Cost Per Unit $ 19.80 $ 3.00 $ 1.50 2,000 units 2,500 units 13.900 ounces 15,000 ounces 510 hours Activate Window
Tharaldson Corporation makes a product with the following standard costs: Direct materials Direct labor Variable overhead Multiple Choice O OO 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 $ 40,000 Actual direct labor cost $ 12,000 Actual variable overhead cost $ 3,000 The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. The labor efficiency variance for June is: ● $2,400 U $900 U $2,400 F Standard Quantity or Hours $900 F 6.6 ounces 0.3 hours. 0.3 hours Standard Price or Rate $ 3.00 per ounce $10.00 per hour $5.00 per hour. Standard Cost Per Unit $ 19.80 $ 3.00 $ 1.50 2,000 units 2,500 units 13.900 ounces 15,000 ounces 510 hours Activate Window
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Concept explainers
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.
Topic Video
Question
100%
2
Transcribed Image Text:**Tharaldson Corporation: Standard Cost Analysis**
Tharaldson Corporation produces a product with the following standard costs:
| **Category** | **Quantity or Hours** | **Standard Price or Rate** | **Standard Cost Per Unit** |
|-------------------|-----------------------|----------------------------|----------------------------|
| Direct materials | 6.6 ounces | $3.00 per ounce | $19.80 |
| Direct labor | 0.3 hours | $10.00 per hour | $3.00 |
| Variable overhead | 0.3 hours | $5.00 per hour | $1.50 |
**June Production Results:**
- Originally budgeted output: 2,000 units
- Actual output: 2,500 units
- Raw materials used in production: 13,000 ounces
- Purchases of raw materials: 15,000 ounces
- Actual direct labor-hours: 510 hours
- Actual cost of raw materials purchases: $40,000
- Actual direct labor cost: $12,000
- Actual variable overhead cost: $3,000
The company assigns variable overhead based on direct labor-hours. The direct materials purchases variance is calculated when the materials are purchased.
**Labor Efficiency Variance for June:**
*Multiple Choice Options:*
- $2,400 U
- $900 U
- $2,400 F
- $900 F (Correct Answer)
The correct choice is $900 F, indicating a favorable labor efficiency variance for June.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 4 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education