Exam 7: Standard Costing and Variance Analysis

Beethoven Company began business early in January using a standard costing for its single product. With standard capacity set at 10,000 standard productive hours per month, the following standard cost sheet was set up for one unit of product: Fixed costs are incurred evenly throughout the year. The following unfavorable variances from standard costs were recorded during the first month of operations: Required: Determine the following: (a) fixed overhead budgeted for a year; (b) the number of units completed during January assuming no work in process at January 31; (c) debits made to the Work in Process account for direct material, direct labor, and manufacturing overhead; (d) number of pieces of material issued during January; (e) total of direct labor payroll recorded for January; (f) total of manufacturing overhead recorded in January.

The variancemost useful in evaluating plant utilization is the

The difference between actual and budgeted fixed factory overhead is referred to as a fixed overhead spending variance.

Under the two-variance approach, the volume variance is computed by subtracting ____ based on standard input allowed for the production achieved from budgeted overhead.

When multiple labor categories are used, the monetary impact of using a higher or lower number of hours than a standard allows is referred to as a ______________________________ variance.

The difference between budgeted and applied fixed factory overhead is referred to as a __________________________________________________.

Fleetwood Company Fleetwood Company uses a standard cost system for its production process and applies overhead based on direct labor hours. The following information is available for May when Fleetwood produced 4,500 units: Refer to Fleetwood Company. Using the four-variance approach, what is the variable overhead spending variance?

Fleetwood Company Fleetwood Company uses a standard cost system for its production process and applies overhead based on direct labor hours. The following information is available for May when Fleetwood produced 4,500 units: Refer to Fleetwood Company. Using the two-variance approach, what is the noncontrollable variance?

Fleetwood Company Fleetwood Company uses a standard cost system for its production process and applies overhead based on direct labor hours. The following information is available for May when Fleetwood produced 4,500 units: Refer to Fleetwood Company. Using the four-variance approach, what is the variable overhead efficiency variance?

The difference between what was paid for inputs and what should have been paid for inputs is referred to as a _________________________.

Crichton Company The following information is for Crichton Company's July production: (Round all answers to the nearest dollar.) Refer to Crichton Company. What is the labor efficiency variance?

Fleetwood Company Fleetwood Company uses a standard cost system for its production process and applies overhead based on direct labor hours. The following information is available for May when Fleetwood produced 4,500 units: Refer to Fleetwood Company. Using the three-variance approach, what is the spending variance?

Wimberly Company Wimberly Company has the following information available for March when 4,200 units were produced (round answers to the nearest dollar). Refer to Wimberly Company. Assume that the company computes the material price variance on the basis of material issued to production. What is the total material variance?

In a just-in-time inventory system,

The difference between actual and budgeted fixed factory overhead is referred to as a fixed overhead volume variance.

A company has a favorable variable overhead spending variance, an unfavorable variable overhead efficiency variance, and underapplied variable overhead at the end of a period. The journal entry to record these variances and close the variable overhead control account will show which of the following?

Luther Manufacturing Company uses a standard cost system and prepared the following budget at normal capacity for October: Using the two-way analysis of overhead variances, what is the controllable variance for October?

Classic Cleaning Company Classic Cleaning Company manufactures a cleaning solvent. The company employs both skilled and unskilled workers. To produce one 55-gallon drum of solvent requires Materials A and B as well as skilled labor and unskilled labor. The standard and actual material and labor information is presented below: Standard: Material A: 30.25 gallons @ $1.25 per gallon Material B: 24.75 gallons @ $2.00 per gallon Skilled Labor: 4 hours @ $12 per hour Unskilled Labor: 2 hours @ $ 7 per hour Actual: Material A: 10,716 gallons purchased and used @ $1.50 per gallon Material B: 17,484 gallons purchased and used @ $1.90 per gallon Skilled labor hours: 1,950 @ $11.90 per hour Unskilled labor hours: 1,300 @ $7.15 per hour During the current month Classic Cleaning Company manufactured 500 55-gallon drums. Round all answers to the nearest whole dollar. Refer to Classic Cleaning Company. What is the labor yield variance?

The difference between actual and budgeted fixed factory overhead is referred to as a __________________________________________________.

Reichs Company The following information is for Reichs Company's September production: (Round all answers to the nearest dollar.) Refer to Reichs Company. What is the labor rate variance?