Thc. Company is a manufacturing company that produces a single product. It has two direct-cost categories. applied to production on the basis of direct labor-hours. Following is the standard cost per unit for the Hookline Inc.: Input Cost per Output Unit Direct materials: 5 pounds at $8 per pound Direct labor: 2 hours at $14 per hour Variable overhead: 2 hours at $5 per hour Total standard cost per unit $40 28 10 $78 The budgeted production and sales volume was 25,000 units. During July, Hookline Inc. produced 30,000 units. The f Materials purchased and used: 160,000 pounds at $7.5 per pound Direct labor: Variable manufacturing overhead occurred for the month: $280,500 55,000 hours used at a rate of $15 per hour Required: For the month of July, computer the following variances, indicating whether each is favorable(F) or unfavorable (U): 1. Direct materials price variance, based on purchases 2. Direct materials efficiency variance 3. Direct manufacturing labor price variance 4. Direct manufacturing labor efficiency variance 5. Variable manufacturing overhead rate variance 6. Variable manufacturing overhead spending variance

Thc. Company is a manufacturing company that produces a single product. It has two direct-cost categories. applied to production on the basis of direct labor-hours. Following is the standard cost per unit for the Hookline Inc.: Input Cost per Output Unit Direct materials: 5 pounds at $8 per pound Direct labor: 2 hours at $14 per hour Variable overhead: 2 hours at $5 per hour Total standard cost per unit $40 28 10 $78 The budgeted production and sales volume was 25,000 units. During July, Hookline Inc. produced 30,000 units. The f Materials purchased and used: 160,000 pounds at $7.5 per pound Direct labor: Variable manufacturing overhead occurred for the month: $280,500 55,000 hours used at a rate of $15 per hour Required: For the month of July, computer the following variances, indicating whether each is favorable(F) or unfavorable (U): 1. Direct materials price variance, based on purchases 2. Direct materials efficiency variance 3. Direct manufacturing labor price variance 4. Direct manufacturing labor efficiency variance 5. Variable manufacturing overhead rate variance 6. Variable manufacturing overhead spending variance

Name: # Cost Variance Analysis ExerciseThis educational exercise focuses on
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Description: # Cost Variance Analysis ExerciseThis educational exercise focuses on cost variance analysis within a manufacturing company context. Below are the details for Hookline Inc., a manufacturing company that produces a single product and applies producti

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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