Accounting: Variance
Not what you're looking for?
Inman Corporation manufactures a single product. The standard cost per unit of product is as follows.
Direct materials - 2 pounds of plastic at $5 per pound $10
Direct labor - 2 hours at $12 per hour 24
Variable manufacturing overhead 12
Fixed manufacturing overhead 6
Total standard cost per unit $52
The master manufacturing overhead budget for the month based on normal productive capacity of 15,000 direct labor hours (7,500 units) shows total variable costs of $90,000 ($6 per labor hour) and total fixed costs of $45,000($3 per labor hour). Normal productive capacity is 15,000 direct labor hours. Overhead is applied on the basis of direct labor hours. Actual costs for November in producing 7,600 units were at follows:
Direct materials (15,00 pounds) $73,500
Direct labor (14,900 hours) 181,780
Variable overhead 88,990
Fixed overhead 44,000
Total manufacturing costs $388,270
The purchasing department normally buys the quantities of raw materials that are expected to be used in production each month. Raw materials inventories., therefore, can be ignored.
Compute all materials , labor, and overhead variances.
Purchase this Solution
Solution Summary
This solution explains how to calculate material, labor, and overhead variances based on given expected and actual values.
Purchase this Solution
Free BrainMass Quizzes
Terms and Definitions for Statistics
This quiz covers basic terms and definitions of statistics.
Measures of Central Tendency
Tests knowledge of the three main measures of central tendency, including some simple calculation questions.
Know Your Statistical Concepts
Each question is a choice-summary multiple choice question that presents you with a statistical concept and then 4 numbered statements. You must decide which (if any) of the numbered statements is/are true as they relate to the statistical concept.
Measures of Central Tendency
This quiz evaluates the students understanding of the measures of central tendency seen in statistics. This quiz is specifically designed to incorporate the measures of central tendency as they relate to psychological research.