The material price variance is favorable when there is a cost-saving that is the actual prices are less than the standard price. The favorable variance helps in increasing the profitability of the entity. The material variances include direct material price variance and direct material quantity variance. The direct material price variance, direct material quantity variance, direct labor price variance, and direct labor quantity variance.

Question

Want to see the full answer?

Answer 1

Question

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

Chapter 26, Problem 5PSA

a.

To determine

Introduction: The material price variance is favorable when there is a cost-saving that is the actual prices are less than the standard price. The favorable variance helps in increasing the profitability of the entity. The material variances include direct material price variance and direct material quantity variance.

The direct material price variance, direct material quantity variance, direct labor price variance, and direct labor quantity variance.

b

To determine

Introduction: The applied overheads are the number of manufacturing overheads determined based on the standard time allowed and standard rate. Applied overheads are based on budget while the actual overheads are the overheads incurred actually.

To calculate: The overhead variance.

c

To determine

Introduction: The income statement consists of revenues, cost of goods sold based on standard costs, gross profit, variances, and net profit. The income statement is the information on revenues earned and costs incurred in addition it also indicates the variances.

To prepare: The income statement.

d

To determine

Introduction: The variance indicates the targeted cots are different from the actual costs. The variances in costs are used to determine the difference and analyze the reason for differences. The variance is used in controlling costs.

To explain: The explanation for unfavorable variance.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

Rental Revenue for this

Financial accounting

Cash Book Balance? Answer step by step

Answer 2

Question

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

Chapter 26, Problem 5PSA

a.

To determine

Introduction: The material price variance is favorable when there is a cost-saving that is the actual prices are less than the standard price. The favorable variance helps in increasing the profitability of the entity. The material variances include direct material price variance and direct material quantity variance.

The direct material price variance, direct material quantity variance, direct labor price variance, and direct labor quantity variance.

b

To determine

Introduction: The applied overheads are the number of manufacturing overheads determined based on the standard time allowed and standard rate. Applied overheads are based on budget while the actual overheads are the overheads incurred actually.

To calculate: The overhead variance.

c

To determine

Introduction: The income statement consists of revenues, cost of goods sold based on standard costs, gross profit, variances, and net profit. The income statement is the information on revenues earned and costs incurred in addition it also indicates the variances.

To prepare: The income statement.

d

To determine

Introduction: The variance indicates the targeted cots are different from the actual costs. The variances in costs are used to determine the difference and analyze the reason for differences. The variance is used in controlling costs.

To explain: The explanation for unfavorable variance.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

Chapter 26, Problem 5PSA

a.

To determine

Introduction: The material price variance is favorable when there is a cost-saving that is the actual prices are less than the standard price. The favorable variance helps in increasing the profitability of the entity. The material variances include direct material price variance and direct material quantity variance.

The direct material price variance, direct material quantity variance, direct labor price variance, and direct labor quantity variance.

b

To determine

Introduction: The applied overheads are the number of manufacturing overheads determined based on the standard time allowed and standard rate. Applied overheads are based on budget while the actual overheads are the overheads incurred actually.

To calculate: The overhead variance.

c

To determine

Introduction: The income statement consists of revenues, cost of goods sold based on standard costs, gross profit, variances, and net profit. The income statement is the information on revenues earned and costs incurred in addition it also indicates the variances.

To prepare: The income statement.

d

To determine

Introduction: The variance indicates the targeted cots are different from the actual costs. The variances in costs are used to determine the difference and analyze the reason for differences. The variance is used in controlling costs.

To explain: The explanation for unfavorable variance.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

Chapter 26, Problem 5PSA

a.

To determine

Introduction: The material price variance is favorable when there is a cost-saving that is the actual prices are less than the standard price. The favorable variance helps in increasing the profitability of the entity. The material variances include direct material price variance and direct material quantity variance.

The direct material price variance, direct material quantity variance, direct labor price variance, and direct labor quantity variance.

b

To determine

Introduction: The applied overheads are the number of manufacturing overheads determined based on the standard time allowed and standard rate. Applied overheads are based on budget while the actual overheads are the overheads incurred actually.

To calculate: The overhead variance.

c

To determine

Introduction: The income statement consists of revenues, cost of goods sold based on standard costs, gross profit, variances, and net profit. The income statement is the information on revenues earned and costs incurred in addition it also indicates the variances.

To prepare: The income statement.

d

To determine

Introduction: The variance indicates the targeted cots are different from the actual costs. The variances in costs are used to determine the difference and analyze the reason for differences. The variance is used in controlling costs.

To explain: The explanation for unfavorable variance.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 26, Problem 5PSA

a.

To determine

Introduction: The material price variance is favorable when there is a cost-saving that is the actual prices are less than the standard price. The favorable variance helps in increasing the profitability of the entity. The material variances include direct material price variance and direct material quantity variance.

The direct material price variance, direct material quantity variance, direct labor price variance, and direct labor quantity variance.

b

To determine

Introduction: The applied overheads are the number of manufacturing overheads determined based on the standard time allowed and standard rate. Applied overheads are based on budget while the actual overheads are the overheads incurred actually.

To calculate: The overhead variance.

c

To determine

Introduction: The income statement consists of revenues, cost of goods sold based on standard costs, gross profit, variances, and net profit. The income statement is the information on revenues earned and costs incurred in addition it also indicates the variances.

To prepare: The income statement.

d

To determine

Introduction: The variance indicates the targeted cots are different from the actual costs. The variances in costs are used to determine the difference and analyze the reason for differences. The variance is used in controlling costs.

To explain: The explanation for unfavorable variance.

Answer 6

Chapter 26, Problem 5PSA

a.

To determine

Introduction: The material price variance is favorable when there is a cost-saving that is the actual prices are less than the standard price. The favorable variance helps in increasing the profitability of the entity. The material variances include direct material price variance and direct material quantity variance.

The direct material price variance, direct material quantity variance, direct labor price variance, and direct labor quantity variance.

Answer 7

Chapter 26, Problem 5PSA

a.

To determine

Introduction: The material price variance is favorable when there is a cost-saving that is the actual prices are less than the standard price. The favorable variance helps in increasing the profitability of the entity. The material variances include direct material price variance and direct material quantity variance.

The direct material price variance, direct material quantity variance, direct labor price variance, and direct labor quantity variance.

Answer 8

b

To determine

Introduction: The applied overheads are the number of manufacturing overheads determined based on the standard time allowed and standard rate. Applied overheads are based on budget while the actual overheads are the overheads incurred actually.

To calculate: The overhead variance.

Answer 9

b

To determine

Introduction: The applied overheads are the number of manufacturing overheads determined based on the standard time allowed and standard rate. Applied overheads are based on budget while the actual overheads are the overheads incurred actually.

To calculate: The overhead variance.

Answer 10

c

To determine

Introduction: The income statement consists of revenues, cost of goods sold based on standard costs, gross profit, variances, and net profit. The income statement is the information on revenues earned and costs incurred in addition it also indicates the variances.

To prepare: The income statement.

Answer 11

c

To determine

Introduction: The income statement consists of revenues, cost of goods sold based on standard costs, gross profit, variances, and net profit. The income statement is the information on revenues earned and costs incurred in addition it also indicates the variances.

To prepare: The income statement.

Answer 12

d

To determine

Introduction: The variance indicates the targeted cots are different from the actual costs. The variances in costs are used to determine the difference and analyze the reason for differences. The variance is used in controlling costs.

To explain: The explanation for unfavorable variance.

Answer 13

d

To determine

Introduction: The variance indicates the targeted cots are different from the actual costs. The variances in costs are used to determine the difference and analyze the reason for differences. The variance is used in controlling costs.

To explain: The explanation for unfavorable variance.

Answer 14

Expert Solution & Answer

Answer 15

Expert Solution & Answer

Answer 16

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 17

Ch. 26 - Prob. 1Q Ch. 26 - 2. (a) Explain the similarities and differences...Ch. 26 - Prob. 3Q Ch. 26 - Prob. 4Q Ch. 26 - Prob. 5Q Ch. 26 - Prob. 6Q Ch. 26 - Prob. 7Q Ch. 26 - Prob. 8Q Ch. 26 - Prob. 9Q Ch. 26 - Prob. 10Q

Solution Summary: The author explains that the material price variance is favorable when there is a cost-saving that is the actual prices are less than the standard price.

Videos

Introduction: The applied overheads are the number of manufacturing overheads determined based on the standard time allowed and standard rate. Applied overheads are based on budget while the actual overheads are the overheads incurred actually.

To calculate: The overhead variance.

Introduction: The income statement consists of revenues, cost of goods sold based on standard costs, gross profit, variances, and net profit. The income statement is the information on revenues earned and costs incurred in addition it also indicates the variances.

To prepare: The income statement.

Introduction: The variance indicates the targeted cots are different from the actual costs. The variances in costs are used to determine the difference and analyze the reason for differences. The variance is used in controlling costs.

To explain: The explanation for unfavorable variance.

Want to see the full answer?

Chapter 26 Solutions

Solution Summary: The author explains that the material price variance is favorable when there is a cost-saving that is the actual prices are less than the standard price.

Videos

Introduction: The applied overheads are the number of manufacturing overheads determined based on the standard time allowed and standard rate. Applied overheads are based on budget while the actual overheads are the overheads incurred actually. To calculate: The overhead variance.

Introduction: The income statement consists of revenues, cost of goods sold based on standard costs, gross profit, variances, and net profit. The income statement is the information on revenues earned and costs incurred in addition it also indicates the variances. To prepare: The income statement.

Introduction: The variance indicates the targeted cots are different from the actual costs. The variances in costs are used to determine the difference and analyze the reason for differences. The variance is used in controlling costs. To explain: The explanation for unfavorable variance.

Want to see the full answer?

Chapter 26 Solutions

Introduction: The applied overheads are the number of manufacturing overheads determined based on the standard time allowed and standard rate. Applied overheads are based on budget while the actual overheads are the overheads incurred actually.

To calculate: The overhead variance.

Introduction: The income statement consists of revenues, cost of goods sold based on standard costs, gross profit, variances, and net profit. The income statement is the information on revenues earned and costs incurred in addition it also indicates the variances.

To prepare: The income statement.

Introduction: The variance indicates the targeted cots are different from the actual costs. The variances in costs are used to determine the difference and analyze the reason for differences. The variance is used in controlling costs.

To explain: The explanation for unfavorable variance.