Exam 9: Standard Costs and Variances

Leerar Corporation makes a product with the following standard costs: In December the company produced 4,200 units using 34,870 ounces of the direct material and 1,900 direct labor-hours.During the month,the company purchased 39,700 ounces of the direct material at a total cost of $111,160.The actual direct labor cost for the month was $35,530 and the actual variable overhead cost was $3,990.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 direct labor rate variance. e.Compute the variable overhead efficiency variance. f.Compute the variable overhead rate variance.

Hurren 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 labor efficiency variance for June is:

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 is the materials price variance for the month?

Sande Corporation makes a product with the following standard costs: In November the company's budgeted production was 2,900 units but the actual production was 3,000 units. The company used 27,670 grams of the direct material and 1,390 direct labor-hours to produce this output. During the month, the company purchased 31,700 grams of the direct material at a cost of $196,540. The actual direct labor cost was $29,607 and the actual variable overhead cost was $2,502. 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 November is:

Tidd Corporation makes a product with the following standard costs: The company reported the following results concerning this product in November. 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 November is:

Mazzo Corporation makes a product with the following standards for direct labor and variable overhead: In February the company's budgeted production was 5,000 units, but the actual production was 5,100 units. The company used 2,090 direct labor-hours to produce this output. The actual variable overhead cost was $6,688. The company applies variable overhead on the basis of direct labor-hours. -The variable overhead rate variance for February is:

The Litton Company has established standards as follows: Direct material: 3 pounds per unit $4 per pound = $12 per unit Direct labor: 2 hours per unit $8 per hour = $16 per unit Variable manufacturing overhead: 2 hours per unit $5 per hour = $10 per unit Actual production figures for the past year are given below. The company records the materials price variance when materials are purchased. The company applies variable manufacturing overhead to products on the basis of standard direct labor-hours. -The labor rate variance is:

Caquias 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:

Marten Corporation makes a product with the following standards for direct labor and variable overhead: In May the company produced 2,800 units using 300 direct labor-hours. The actual variable overhead cost was $1,620. The company applies variable overhead on the basis of direct labor-hours. -The variable overhead efficiency variance for May is:

The Litton Company has established standards as follows: Direct material: 3 pounds per unit $4 per pound = $12 per unit Direct labor: 2 hours per unit $8 per hour = $16 per unit Variable manufacturing overhead: 2 hours per unit $5 per hour = $10 per unit Actual production figures for the past year are given below. The company records the materials price variance when materials are purchased. The company applies variable manufacturing overhead to products on the basis of standard direct labor-hours. -The materials quantity variance 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 rate variance for the month?

The Geurtz Company uses standard costing. The company makes and sells a single product called a Roff. The following data are for the month of August: • Actual cost of direct material purchased and used: $65,560 • Material price variance: $5,960 unfavorable • Total materials variance: $22,360 unfavorable • Standard cost per pound of material: $4 • Standard cost per direct labor-hour: $5 • Actual direct labor-hours: 6,500 hours • Labor efficiency variance: $3,500 favorable • Standard number of direct labor-hours per unit of Roff: 2 hours • Total labor variance: $400 unfavorable -The total number of units of Roff produced during August was:

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 is the materials quantity variance for the month?

The auto repair shop of Empire Motor Sales uses standards to control labor time and labor cost in the shop. The standard time for a motor tune-up is 2.5 hours. The record showing time spent in the shop last week on tune-ups has been misplaced; however, the shop supervisor recalls that 50 tune-ups were completed during the week and the controller recalls that the labor rate variance on tune-ups was $87, favorable. The shop has a set standard labor rate of $9 per hour for tune-up work. The total labor variance for the week on tune-up work was $93, unfavorable. -The actual hourly rate of pay for tune-up work last week was:

Snuggs Corporation makes a product with the following standard costs: The company reported the following results concerning this product in October. 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 October is:

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

Arrow Industries uses a standard cost system in which direct materials inventory is carried at standard cost. Arrow has established the following standards for the prime costs of one unit of product. During May, Arrow purchased 160,000 pounds of direct material at a total cost of $304,000. The total direct labor wages for May were $37,800. Arrow manufactured 19,000 units of product during May using 142,500 pounds of direct material and 5,000 direct labor-hours. -The direct labor efficiency variance for May is:

The auto repair shop of Empire Motor Sales uses standards to control labor time and labor cost in the shop. The standard time for a motor tune-up is 2.5 hours. The record showing time spent in the shop last week on tune-ups has been misplaced; however, the shop supervisor recalls that 50 tune-ups were completed during the week and the controller recalls that the labor rate variance on tune-ups was $87, favorable. The shop has a set standard labor rate of $9 per hour for tune-up work. The total labor variance for the week on tune-up work was $93, unfavorable. -The number of actual hours spent on tune-up work last week was:

Jardell Corporation makes a product with the following standards for labor and variable overhead: The company budgeted for production of 6,400 units in June, but actual production was 6,400 units. The company used 3,180 direct labor-hours to produce this output. The actual variable overhead rate was $4.90 per hour. The company applies variable overhead on the basis of direct labor-hours. -The variable overhead rate variance for June is:

Arrow Industries uses a standard cost system in which direct materials inventory is carried at standard cost. Arrow has established the following standards for the prime costs of one unit of product. During May, Arrow purchased 160,000 pounds of direct material at a total cost of $304,000. The total direct labor wages for May were $37,800. Arrow manufactured 19,000 units of product during May using 142,500 pounds of direct material and 5,000 direct labor-hours. -The direct materials price variance for May is: