Exam 9: Standard Costing: a Functional-Based Control Approach

During January, 7,175 direct labor hours were worked at a standard cost of $20 per hour. If the direct labor rate variance for January was $17,500 favorable, the actual cost per direct labor hour must be

Montana Company uses a standard costing system. The following information pertains to direct labor costs for the month of February: Standard direct labor rate per hour \ 15.00 Actual direct labor rate per hour \ 13.50 Labor rate variance \ 18,000 favorable Actual output 1,000 units Standard hours all owed for actual production 10,000 hours What is the total labor budget variance for Montana Company?

During June, 16,000 pounds of materials were purchased at a cost of $6 per pound. If there was a favorable direct materials price variance of $3,000 in June, the standard cost per pound must be _____. (Round to two decimal places.)

Formidable Company collected the following information: Standard costs per unit: Variable overhead 4 machine hours @\ 6 per machine hour Fixed overhead 4 machine hours @\ 10 per machine hour Actual output 20,000 units Denominator (normal capacity) output 21,000 units Actual machine hours 79,000 machine hours Actual variable overhead cost \ 540,000 Actual fixed overhead cost \ 810,000 Using the two variance method, what is the budget variance?

Unfavorable variances occur whenever actual prices or usage are less than standard prices or usage, and the opposite for a favorable variance.

Which of the following factors would cause an unfavorable labor rate variance?

the direct materials mix variance is the difference in the standard cost of actual inputs and the standard costs of inputs that should have been used.

Biscuit Company has developed the following standards for one of its products. Direct labor hours is the driver used to assign overhead costs to products. Direct materials: 10 pounds \times\ 3 per pound Direct labor: 2.5 hours \times\ 8 per hour Variable manufacturing overhead: 2.5 hours \times\ 2 per hour $\text { The following activity occurred during the month of June: }$ Materials purchased: 125,000 pounds at \ 2.60 per pound Materials used: 110,000 pounds Units produced: 10,000 units Direct labor: 24,000 hours at \ 7.50 per hour Actual variable manufacturing overhead: \ 51,000 The company records materials price variances at the time of purchase. The variable manufacturing overhead efficiency variance is

Montana Company uses a standard costing system. The following information pertains to direct labor costs for the month of February: Standard direct labor rate per hour \ 15.00 Actual direct labor rate per hour \ 13.50 Labor rate variance \ 18,000 favorable Actual output 1,000 units Standard hours all owed for actual production 10,000 hours How many actual labor hours were worked during February for Montana Company?

A five-percent wage increase for all factory employees would affect which of the following variances?

Montecino Corporation uses two different types of labor to manufacture its product. The types of labor, Cutting and Setup, have the following standards: Labor Type Standard Mix Standard Unit Price Standard Cost Cutting 500 hours \ 7.50 per unit \ 3,750 Setup 125 hours 5.00 per unit \ 625 Yield 3,125 units During July, the following actual production information was provided: Labor Type Actual MIix Cutting 4,375 hours Setup 1,875 hours Yield 28,125 units What is the Labor mix variance?

Which of the following is true of mix variance?

The following information is provided about three materials utilized in the production of a product: Material Standard Mix Standard Unit Price Standard Cost 1,250 units \ 3.00 per unit \ 3,750 750 units 5.00 per unit \ 3,750 500 units 4.00 per unit \ 2,000 Yield 2,250 units During May, the following actual production in formati on was provided: 10,000 units Y 5,000 units Z 2,500 units Yield 15,000 units Calculate the Material mix variance.

Synergy Manufacturing Company has a normal monthly activity of 7,500 units. Standard factory overhead rates are based on a normal monthly volume of one standard direct hour per unit. Standard factory overhead rates per direct labor hour are: Fixed \ 5.00 Variable 12.00 \1 7.00 Units actually produced in 7,000 units current month Actual factory overhead costs \ 140,000 incurred (includes \ 50,000 fixed) What is the variable overhead spending variance for Synergy?

The sum of the standard plus allowable deviation is called the upper __________ .

Alumni Manufacturing Company has the following information pertaining to a normal monthly activity of 10,000 units: Standard factory overhead rates are based on a normal monthly volume of one standard direct hour per unit. Standard factory overhead rates per direct labor hour are: Fixed \ 6.00 Variable 10.00 \ 16.00 Units actually produced in current month 9,000 units Actual factory overhead costs incurred (includes \ 70,000 fixed) \ 156,000 Actual direct labor hours 9,000 hours What is the fixed overhead spending variance for Alumni?

During October, 10,000 direct labor hours were worked at a standard cost of $10 per hour. If the direct labor rate variance for October was $4,000 unfavorable, the actual cost per direct labor hour must be

The direct materials price variance is the difference between actual and standard pricing.

A mix variance is created whenever the actual mix of inputs is equal to the standard mix.

If variable manufacturing overhead is applied based on direct labor hours and there is an unfavorable direct labor efficiency variance