Exam 10: Standard Costs and Variances

Epley Corporation makes a product with the following standard costs: In July the company produced 3, 300 units using 12, 240 pounds of the direct material and 2, 760 direct labor-hours.During the month, the company purchased 13, 000 pounds of the direct material at a cost of $35, 100.The actual direct labor cost was $51, 612 and the actual variable overhead cost was $20, 148. 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 rate variance for July is:

The standard cost per unit is computed by dividing the standard quantity or hours by the standard price or rate.

Sizzle Company uses a standard cost system to collect costs related to the production of its "No-Stick" lawn chairs.The direct material for the chairs is teflon.Sizzle uses a standard direct material cost of $40.00 per chair (0.8 pounds of teflon × $50.00 per pound).During April, Sizzle purchased 2, 100 pounds of teflon for $106, 575.Sizzle used 1, 750 pounds of this teflon in April to produce 1, 800 lawn chairs. Required: Calculate Sizzle's materials price and materials quantity variances for April.

Wall Corporation, which produces commercial safes, has provided the following data: Supplies cost is an element of variable manufacturing overhead. The variable overhead efficiency variance for supplies is closest to:

Kowaleski Corporation makes a product with the following standard costs: In June the company produced 9, 100 units using 27, 010 kilos of the direct material and 930 direct labor-hours.During the month the company purchased 30, 600 kilos of the direct material at a price of $3.70 per kilo.The actual direct labor rate was $19.90 per hour and the actual variable overhead rate was $4.20 per hour.The materials price variance is computed 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.

Degregorio Corporation makes a product that uses a material with the following direct material standards: The company produced 5, 600 units in November using 21, 750 kilos of the material.During the month, the company purchased 24, 800 kilos of the direct material at a total cost of $168, 640.The direct materials purchases variance is computed when the materials are purchased. The materials price variance for November is:

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