Exam 10: Standard Costs and Variances

Kropf Inc.has provided the following data concerning one of the products in its standard cost system.Variable manufacturing overhead is applied to products on the basis of direct labor-hours. The company has reported the following actual results for the product for September: Required: a.Compute the materials price variance for September. b.Compute the materials quantity variance for September. c.Compute the labor rate variance for September. d.Compute the labor efficiency variance for September. e.Compute the variable overhead rate variance for September. f.Compute the variable overhead efficiency variance for September.

The Bowden Corporation makes a single product. Only one kind of direct material is used to make this product. The company uses a standard cost system. The company's cost records for June show the following data: There were no beginning inventories of direct materials. -The actual cost of direct material was:

Doogan Corporation makes a product with the following standard costs: The company produced 5,200 units in January using 39,310 grams of direct material and 2,380 direct labor-hours. During the month, the company purchased 44,400 grams of the direct material at $1.70 per gram. The actual direct labor rate was $19.30 per hour and the actual variable overhead rate was $6.80 per hour. The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. -The variable overhead efficiency variance for January is:

Termeer Inc. has provided the following data concerning one of the products in its standard cost system. Variable manufacturing overhead is applied to products on the basis of direct labor-hours. The company has reported the following actual results for the product for August: -The variable overhead rate variance for the month is closest to:

Hermansen Corporation produces large commercial doors for warehouses and other facilities.In the most recent month,the company budgeted production of 5,100 doors.Actual production was 5,400 doors.According to standards,each door requires 3.8 machine-hours.The actual machine-hours for the month were 20,880 machine-hours.The standard supplies cost is $7.90 per machine-hour.The actual supplies cost for the month was $152,063.Supplies cost is an element of variable manufacturing overhead.The variable overhead efficiency variance for supplies cost is:

Pyrdum Corporation produces metal telephone poles.In the most recent month,the company budgeted production of 3,500 poles.Actual production was 3,800 poles.According to standards,each pole requires 4.6 machine-hours.The actual machine-hours for the month were 17,800 machine-hours.The standard variable manufacturing overhead rate is $5.40 per machine-hour.The actual variable manufacturing overhead cost for the month was $96,712.The variable overhead efficiency variance is:

The following standards for variable overhead have been established for a company that makes only one product: The following data pertain to operations for the last month: Required: a.What is the variable overhead rate variance for the month? b.What is the variable overhead efficiency variance for the month?

If the actual hourly rate is greater than the standard hourly rate,the labor rate variance is labeled unfavorable (U).

Tharaldson Corporation makes a product with the following standard costs: The company reported the following results concerning this product in June. The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. -The materials price variance for June is:

Valera Corporation makes a product with the following standards for labor and variable overhead: The company budgeted for production of 5,300 units in July, but actual production was 5,400 units. The company used 2,130 direct labor-hours to produce this output. The actual variable overhead rate was $6.10 per hour. The company applies variable overhead on the basis of direct labor-hours. -The variable overhead efficiency variance for July is:

Handerson Corporation makes a product with the following standard costs: The company reported the following results concerning this product in August. The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. -The labor efficiency variance for August is:

Miguez Corporation makes a product with the following standard costs: The company budgeted for production of 2,600 units in September, but actual production was 2,500 units. The company used 5,440 liters of direct material and 1,680 direct labor-hours to produce this output. The company purchased 5,800 liters of the direct material at $7.20 per liter. The actual direct labor rate was $24.10 per hour and the actual variable overhead rate was $1.90 per hour. The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. -The variable overhead efficiency variance for September is:

A partial standard cost card for the single product produced by Mercer Company is given below: Direct materials: 3 pounds @ $8 per pound Direct labor: ? hours @ ? per hour Last period the company produced 4,000 units of product.Cost and other data associated with this production are given below: The direct materials purchases variance is computed when the materials are purchased. Required: a.Determine the number of pounds of direct materials purchased and used during the period. b.Determine the materials quantity variance. c.Determine the standard direct labor rate per direct labor hour. d.Determine the standard hours allowed for the production of the period.

Reagen Corporation makes a product with the following standard costs: The company reported the following results concerning this product in December. The materials price variance is recognized when materials are purchased.Variable overhead is applied on the basis of direct labor-hours. Required: a.Compute the materials quantity variance. b.Compute the materials price variance. c.Compute the labor efficiency variance. d.Compute the labor rate variance. e.Compute the variable overhead efficiency variance. f.Compute the variable overhead rate variance.

A manufacturing company that has only one product has established the following standards for its variable manufacturing overhead. The company bases its variable manufacturing overhead standards on direct labor-hours. The following data pertain to operations for the last month: -The variable overhead efficiency variance for July is:

Majer Corporation makes a product with the following standard costs: The company reported the following results concerning this product in February. The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. -The materials quantity variance for February is:

Galeazzi Corporation makes a product with the following standard costs: In October the company produced 3,000 units using 8,380 pounds of the direct material and 2,610 direct labor-hours.During the month,the company purchased 9,500 pounds of the direct material at a total cost of $55,100.The actual direct labor cost for the month was $48,546 and the actual variable overhead cost was $16,965.The company applies variable overhead on the basis of direct labor-hours.The direct materials purchases variance is computed when the materials are purchased. Required: a.Compute the materials quantity variance. b.Compute the materials price variance. c.Compute the labor efficiency variance. d.Compute the labor rate variance. e.Compute the variable overhead efficiency variance. f.Compute the variable overhead rate variance.

The following labor standards have been established for a particular product: The following data pertain to operations concerning the product for the last month: -The labor rate variance for November is:

The following data have been provided by Moretta Corporation,a company that produces forklift trucks: Supplies cost is an element of variable manufacturing overhead.The variable overhead efficiency variance for supplies cost is:

Miguez Corporation makes a product with the following standard costs: The company budgeted for production of 2,600 units in September, but actual production was 2,500 units. The company used 5,440 liters of direct material and 1,680 direct labor-hours to produce this output. The company purchased 5,800 liters of the direct material at $7.20 per liter. The actual direct labor rate was $24.10 per hour and the actual variable overhead rate was $1.90 per hour. The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. -The labor efficiency variance for September is: