Standard Cost and Variances of Material
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19. The following materials standards have been established for a particular raw material used in the company's sole product:
Standard quantity per unit of output 1.0 pound
Standard price $16.60 per pound
The following data pertain to operations concerning the product for the last month:
Actual materials purchased 2,200 pounds
Actual cost of materials purchased $34,650
Actual materials used in production 1,900 pounds
Actual output 2,100 units
What is the materials quantity variance for the month?
A) $3,320 F
B) $3,150 F
C) $4,980 U
D) $4,725 U
20. The following standards for variable manufacturing overhead have been established for a company that makes only one product:
Standard hours per unit of output 2.8 hours
Standard variable overhead rate $16.30 per hour
The following data pertain to operations for the last month:
Actual hours 7,600 hours
Actual total variable overhead cost $127,300
Actual output 2,500 units
What is the variable overhead spending variance for the month?
A) $3,420 U
B) $3,150 F
C) $10,050 U
D) $13,200 U
21. The following materials standards have been established for a particular product:
Standard quantity per unit of output 0.2 grams
Standard price $18.90 per gram
The following data pertain to operations concerning the product for the last month:
Actual materials purchased 4,800 grams
Actual cost of materials purchased $86,880
Actual materials used in production 4,200 grams
Actual output 21,080 units
Required:
a. What is the materials price variance for the month? (2 points)
b. What is the materials quantity variance for the month? (2 points)
22. The following labor standards have been established for a particular product:
Standard labor hours per unit of output 3.2 hours
Standard labor rate $19.10 per hour
The following data pertain to operations concerning the product for the last month:
Actual hours worked 5,500 hours
Actual total labor cost $105,050
Actual output 1,900 units
Required:
a. What is the labor rate variance for the month? (2 points)
b. What is the labor efficiency variance for the month? (2 points)
23. The following standards for variable manufacturing overhead have been established for a company that makes only one product:
Standard hours per unit of output 0.6 hours
Standard variable overhead rate $17.55 per hour
The following data pertain to operations for the last month:
Actual hours 6,200 hours
Actual total variable overhead cost $110,670
Actual output 10,200 units
Required:
a. What is the variable overhead spending variance for the month? (2 points)
b. What is the variable overhead efficiency variance for the month? (2 points)
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Solution Summary
This solution is comprised of a detailed explanation to calculate quantity variance and efficiency variance.
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19. The following materials standards have been established for a particular raw material used in the company's sole product:
Standard quantity per unit of output 1.0 pound
Standard price $16.60 per pound
The following data pertain to operations concerning the product for the last month:
Actual materials purchased 2,200 pounds
Actual cost of materials purchased $34,650
Actual materials used in production 1,900 pounds
Actual output 2,100 units
What is the materials quantity variance for the month?
A) $3,320 F
B) $3,150 F
C) $4,980 U
D) $4,725 U
Answer: A
Materials quantity variance = difference between actual quantity x standard cost per unit of
used and standard quantity allowed input
= (1,900 - (2,100 x 1 lb.) x $16.60
= $3,320 F
20. The following standards for variable manufacturing ...
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