Chapter 8, Problem 8.38P

1.a

To determine

To compute: Total pounds of direct materials purchased.

Given information:

August 2014,

Direct material price variance is $179,300.

Direct material price variance per pound is $1.10.

b.

To determine

To compute: Total number of pounds of excess direct materials used.

Given information:

August 2014,

Units produced are 20,000 units.

Budgeted quantity of materials input for each output unit is 6 pounds.

Efficiency variance is $75,900.

Budgeted price of input is $11.50.

c.

To determine

To compute: Variable manufacturing overhead spending variance.

Given information:

August 2014,

Variable overhead efficiency variance is $18,100.

Variable overhead flexible budget variance is $10,400.

d.

To determine

To compute: Total number of actual direct manufacturing labor-hours used.

Given information:

August 2014,

Direct manufacturing labor cost incurred is $535,500.

Budgeted direct labor cost at 50,000 budgeted direct manufacturing labor-hour level for August is $1,250,000.

e.

To determine

To compute: Total number of standard direct manufacturing labor-hours allowed for the units produced.

Given information:

August 2014,

Total number of actual labor hours used as computed is 21,000 hours

Efficiency variance is $40,000.

Budgeted price of input is $25.

f.

To determine

To compute: Production-volume variance.

Given information:

August 2014,

Budgeted fixed overheads are $1,000,000.

Budgeted fixed overhead rate is $\$200\text{ per hour}\left(\frac{\$1,000,000}{50,000\text{ labor hours}}\right)$

Labor hours allocated for actual output is 19,400 hours.

2.

To determine

G’s control of variable manufacturing overhead items differs from its control of fixed manufacturing overhead items.