Exam 10: Standard Costs and Overhead Analysis

Dahl Company,a clothing manufacturer,uses a standard costing system.Each unit of a finished product contains 2 metres of cloth.However,there is unavoidable waste of 20%,calculated on input quantities,when the cloth is cut for assembly.The cost of the cloth is $3 per metre.What is the standard direct material cost for cloth per unit of finished product?

The Ferris Company applies manufacturing overhead costs to products on the basis of direct labour hours. The standard cost card shows that 3 direct labour hours are required per unit of product. For August, the company budgeted to work 90,000 direct labour hours and to incur the following total manufacturing overhead costs: During August, the company completed 28,000 units of product, worked 86,000 direct labour hours, and incurred the following total manufacturing overhead costs: The denominator activity used for the predetermined overhead rate was 90,000 direct labour hours. -For August,what was the variable overhead spending variance?

A manufacturing company that has only one product has established the following standards for its variable manufacturing overhead. The company uses direct labour hours (DLHs) as its measure of activity. The following data pertain to operations for the last month: -What was the variable overhead spending variance for the month?

The Upton Company employs a standard costing system in which variable overhead is assigned to production on the basis of direct labour hours. Data for the month of February include the following: -What was the variable overhead spending variance?

What does a favourable labour rate variance indicate?

The following labour standards have been established for a particular product: Standard labour hours per unit of output 1.7 metres Standard labour rate \ 14.05 per metre The following data pertain to operations concerning the product for the last month: Actual hours worked 3,700 hours Actual total labour cost \ 50,690 Actual output 2,300 units What was the labour rate variance for the month?

The Adlake Company makes and sells a single product and uses a standard cost system.During October,the company budgeted $300,000 in manufacturing overhead cost at a denominator activity of 20,000 machine hours.At standard,each unit of finished product requires 5 machine hours.The following cost and activity were recorded during October: Total Actual Manufacturing Overhead Cost Incurred Units of Product Completed Actual Machine Hours Worked \ 294,000 3,800 19,422 What was the amount of overhead cost that the company applied to work in process for October?

(Appendix 10A)A mix variance for direct materials can be derived as the difference between the quantity variance and the yield variance.

Tracton Corporation uses a standard costing system in which manufacturing overhead costs are applied to products on the basis of machine time. Required: a) Several numbers and labels have been omitted from the analysis of fixed overhead below. Supply the missing numbers and labels. \begin{array}{ccc}&&\text { Fixed Overhead Cost }\\&&\text {Applied to }\\\text { Actual Fixed } & \text { Flexible Budget } & \text { Work in Process } \\\text { Overhead Cost } & \text { Fixed Overhead Cost } & 302,100 \mathrm{MH} \text { x \$1.08 }\\?&?&?\\\\&\text {Budget variance, }&?\\&\text {\$ 1,880 U}&?\\\\&\text {Total variance, \$ 388 \mathrm F }\\\end{array} b) Suppose that 6 minutes of machine time is standard per unit of production. How many units were actually produced in the situation above? c) Again suppose that 6 minutes of machine time is standard per unit of production. How many units of production were assumed when the predetermined application rate for fixed overhead was established?

Tower Company planned to produce 3,000 units of its single product,Titactium,during November.The standards for one unit of Titactium specify six kilograms of materials at $0.30 per kilogram.Actual production in November was 3,100 units of Titactium.There was a favourable materials price variance of $380 and an unfavourable materials quantity variance of $120.Based on these variances,what could one assume?

The Murray Company makes and sells a single product. The company recorded the following activity and cost data for May: The fixed portion of the predetermined overhead rate is $0.95 per direct labour hour. -What was the amount of fixed manufacturing overhead cost applied to work in process during May?

A manufacturing company has a standard costing system based on machine hours (MHs) as the measure of activity. Data from the company's flexible budget for manufacturing overhead are given below: The following data pertain to operations for the most recent period: -What was the variable overhead efficiency variance for the period,rounded to the nearest dollar?

Information on Kennedy Company's direct material costs follows: Standard price per kilogram of raw materials \ 3.60 Actual quantity of raw materials purchased 1,600 kilograms Standard quantity allowed for actual production 1,450 kilograms Materials purchase price variance-favourable \ 240 What was the actual purchase price per unit,rounded to the nearest cent?

For the month of April,Thorp Co.'s records disclosed the following data relating to direct labour: Actual cost \ 10,000 Rate variance \ 1,000 favourable Efficiency variance \ 1,500 unfavourable For the month of April,actual direct labour hours amounted to 2,000.In April,what was Thorp's standard direct labour rate per hour?

(Appendix 10B) The Dexon Company makes and sells a single product, called a Mip, and employs a standard costing system. The following standards have been established for one unit of Mip: There were no inventories of any kind on August 1. During August, the following events occurred: Purchased 15,000 board metres at the total cost of $24,000. Used 12,000 board metres to produce 2,100 Mips. Used 1,700 hours of direct labour time at a total cost of $20,060. -(Appendix 10B)To record the purchase of direct materials,the general ledger would include what entry to the Materials Price Variance account?

The following materials standards have been established for a particular product: The following data pertain to operations concerning the product for the last month: -What was the materials quantity variance for the month?

A manufacturing company that has only one product has established the following standards for its variable manufacturing overhead. The company uses direct labour hours (DLHs) as its measure of activity. The following data pertain to operations for the last month: -What was the variable overhead efficiency variance for the month?

Which of the following is NOT true for fixed manufacturing overhead costs in a standard costing system?

A manufacturing company that has only one product has established the following standards for its variable manufacturing overhead. The company uses machine hours as its measure of activity. The following data pertain to operations for the last month: -What was the variable overhead efficiency variance for the month?

The Porter Company has a standard cost system.In July,the company purchased and used 22,500 kilograms of direct material at an actual cost of $53,000,the materials quantity variance was $1,875 unfavourable,and the standard quantity of materials allowed for July production was 21,750 kilograms.What was the materials price variance for July?