Exam 10: Standard Costs and Overhead Analysis

Which of the following is the most probable reason a company would experience an unfavourable labour rate variance and a favourable labour efficiency variance?

Jessep Corporation has a standard cost system in which manufacturing overhead is applied to units of product on the basis of direct labour hours. The company has provided the following data concerning its fixed manufacturing overhead costs in March: Denominator Hours 15,000 hours Actual Hours Worked 14,000 hours Standard Hours Allowed for the Output 12,000 hours Flexible Budget Fixed Overhead Cost \ 45,000 Actual Fixed Overhead Costs \ 48,00 -What was the fixed overhead budget variance?

You have just been hired as the controller of the Eastern Division of Global Manufacturing.Performance records for last year are incomplete,with only the following data available: Variable Overhead Rate \ 3.00 per direct labour hour Budgeted Fixed Overhead \ 84,800 Total Actual Overhead Cost \ 262,500 Fixed overhead Budget Variance \ 7,200 unfavourable Variable Overhead Efficiency Variance \ 15,000 unfavourable Actual Direct Labour Hours Worked 55,000 direct labour hours Denominator Activity Level 53,000 direct labour hours Standard Hours per Unit 2 direct labour hours Required: Prepare a complete analysis of manufacturing overhead for the past year.Indicate actual,standard,and denominator activity levels; variable overhead spending and efficiency variances; and fixed overhead budget and volume variances.

The overhead spending variance contains price but not quantity elements.

A manufacturer of industrial equipment has a standard costing system based on direct labour hours (DLHs) as the measure of activity. Data from the company's flexible budget for manufacturing overhead are given below: Denominator Level of Activity 8,000 Overhead Costs at the Denominator Activity Level: Variable Overhead Cost \ 56,400 Fixed Overhead Cost \ 100,800 The following data pertain to operations for the most recent period: Actual Hours 7,800 Standard Hours Allowed for the Actual Output 7,735 Actual Total Variable Overhead Cost \ 54,210 Actual Total Fixed Overhead Cost \ 100,200 -What was the total predetermined overhead rate,rounded to the nearest cent?

Web Company uses a standard cost system that applies manufacturing overhead to units of product on the basis of machine hours.During February,the company used a denominator activity of 80,000 machine hours in computing its predetermined overhead rate.However,only 75,000 standard machine hours were allowed for the month's actual production.If the fixed overhead volume variance for February was $6,400 unfavourable,what was the total budgeted fixed overhead cost for the month?

The predetermined overhead rate (variable and fixed)is $7.50 per machine hour,and the denominator activity level is 135,000 machine hours.If the variable portion of the predetermined overhead rate is $3.00 per machine hour,what is the budgeted fixed factory overhead for the year?

Which department is usually held responsible for an unfavourable materials quantity variance?

Kyekyeku Company retails two models of a product: Model X and Model Y. It considers both products to be close substitutes. The following data relate to the company's operations for last year: Model X Model Y Total Sales in Units: Budget 1,000 1,000 2,000 Actual 1,008 1,092 2,100 Contribution Margins per Unit: Budget \ 30 \ 40 Actual \ 25 \ 38 Market Volume in Units: Budget 40,000 Actual 52,500 - What were the sales volume variances for Model X and Model Y,respectively,for last year?

King Company estimated that it would operate its manufacturing facilities at 800,000 direct labour hours for the year, which served as the denominator activity in the predetermined overhead rate. The total budgeted manufacturing overhead for the year was $2,000,000, of which $1,600,000 was variable and $400,000 was fixed. The standard variable overhead rate was $2 per direct labour hour. The standard direct labour time was 3 direct labour hours per unit. The actual results for the year are presented below: Actual Finished Units 250,000 Actual Direct Labour Hours 764,000 Actual Variable Overhead \ 1,610,000 Actual Fixed Overhead \ 392,000 -What was the variable overhead spending variance for the year?

A manufacturer of playground equipment 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: Denominator Level of Activity 3,000 Fixed Overhead Cost \ 40,650 The following data pertain to operations for the most recent period: Actual Hours 3,400 Standard Hours Allowed for the Actual Output 3,172 Actual Total Fixed Overhead Cost \ 41,600 -What was the fixed overhead budget variance for the period,rounded to the nearest dollar?

) Saskatoon Company uses two raw materials, A and B, in the manufacture of its only product: Zizbo. The materials are very close substitutes. The standard proportions for the manufacture of a unit of Zizbo are 2 units of A and 3 units of B. The unit standard prices of A and B are $10 and $8, respectively. During the month of August, the company used 450 units of A and 750 units of B to produce 230 units of Zizbo. -Which one of the following variances is MOST controllable by a production supervisor?

The following materials standards have been established for a particular product: Standard quantity per unit of output 6.8 metres Standard price \ 17.10 per metre The following data pertain to operations concerning the product for the last month: Actual materials purchased 9,000 metres Actual cost of materials purchased \ 156,600 Actual materials used in production 8,500 metres Actual output 1,200 units -What was the materials quantity variance for the month?

The fixed portion of the predetermined overhead rate is used for product costing purposes and has no significance in terms of cost control.