a. What is the material price usage, material quantity and total material variance D. What is the material purchase price and material inventono
Q: Why is the direct materials usage variance allocated only to WIP Inventory, Finished Goods…
A: Solution:- Introduction:- The following formula used to calculation as follows:- materials usage…
Q: The material price variance is computed by multiplying the difference between the actual price and…
A: GIVEN Material Price Variance is the difference between the actual cost of Material purchased and…
Q: Direct Materials and Direct Labor Variance Analysis
A: a. Determine standard cost per unit Direct material standard cost per unit = Std. number of lbs of…
Q: Compute the net overhead variance (indicate over- or underapplied manufacturing overhead)
A: Overhead Variance is the deviation of actual overhead incurred from the standard overhead…
Q: From the following information calculate Labour cost Variance, Labour Rate Variance and Labour…
A: Variance can be defined as the alteration between the actual amounts and the budgets being set. The…
Q: etermine the following: Total material price variance Total material usage (quantity) variance Labor…
A: Variable overhead refers to the expenses which fluctuate with the change in the number of goods or…
Q: Required: Calculate the following: i. Material price variance ii. Material usage variance) iii.…
A: The calculation of actual per unit costs for material and labor has been calculated as follows:…
Q: What is the interpretation of the direct-material quantity variance?
A: Direct material quantity variance is a variance analysis tool for manufacturing companies. It shows…
Q: (a) Calculate the material price variance (b) Calculate the material quantity variance (c) Calculate…
A: Material Price Variance =( Standard Price - Actual Price )× Actual Quantity Material Quantity…
Q: The materials price variance should be computed when materials are purchased. Group of answer…
A: Variance: The difference between the actual cost or price and the budgeted (standard) cost or price…
Q: (b) Calculate the material quantity variance
A: Material quantity variance is also known as material usage variance. Formula: = ( Standard quantity…
Q: What is the interpretation of the direct-material price variance and the direct-material purchase…
A: Definition: Variance: Variance refers to the different levels in the actual cost incurred and…
Q: Who is generally responsible for the materials price variance? The materials quantity variance? The…
A: Material Price Variance is the difference between the standard price and the actual price for the…
Q: What type of variances are computed for materials, labour, and factory overhead
A: material variance = standard cost - actual cost of materials. types 1.Material Price Variance: MPV =…
Q: The sum of the material mix and material yield variances equals the total material variance. the…
A: Standard costing means where standard is set for various cost element and actual cost is then…
Q: what are relevent cost of direct material
A: The management of the manufacturing firm has to take certain decisions regarding the…
Q: A. Assume the variance is material, what is the variance share of the Finished goods inventory acc?…
A: Overhead means the cost incurred indirect in factory for the production of goods. Manufacturing…
Q: Under Standard Costing System, direct material price variance shall be appropriately computed using…
A: Standard costing means where standard is set for various cost element and actual cost is then…
Q: Compute the price and efficiency variances of direct materials and direct manufacturing
A: Standard costing - This is the method of costing where standard is determined and then its compared…
Q: what is the Total factory overhead cost variance?
A: Cost variance is the variance which is measured by the company so that the decision and it can be…
Q: hich of the following factor may not be included in the computation of the total materials variance?…
A: Formula Total Material variance = (Standard cost of material allowed for actual output) – (Actual…
Q: Describe the term cost of the direct materials.
A: Cost: Cost refers to the expenses incurred by the business to earn revenue from sales, in other…
Q: MATERIALS MIX VARIANCE
A:
Q: Prepare variance analysis for materials, labor and overhead
A: Variance analysis can be defined as investigation tool which studies the deviation between the…
Q: standard cost
A: Standard cost systems are cost accounting systems in which standard is set for each item of cost and…
Q: The cost price variance is
A: Cost price variance refers to the difference between the actual cost and standard cost of units.…
Q: Provide the meaning of material cost and the procedure for estimation of material cost
A: Material costs are those costs incurred to produce a product or provide a service. Any product has a…
Q: Assume the variance is material, what is the adjustment of the cost of good sold
A: Solution: Adjustment cost of goods sold vary based on variance in material or immaterial.
Q: Multiple Choice debit to Work in Process, debit to Material Price Variance, credit to Raw Materials…
A: Journal entry A journal entry is a record of the business transactions within the accounting books…
Q: Which one of the following best describes the direct material price variance? O a. The difference…
A: Direct Material price variance can be calculated by using the following formula: (AQ × SP ) -…
Q: Calculate the material quantity variance and the engineering change order (ECO) material variance.
A: Material quantity variance is a category of variance that compares actual quantity and standard…
Q: What is the cost per equivalent unit for materials?
A:
Q: a. Direct materials price variance (based on purchases) b. Direct materials efficiency variance c.…
A: Every manufacturing unit has some estimated standard costs for the production based on the past…
Q: What is the formula used to determine the amount of direct materials to be purchased?
A: Direct materials: Direct materials are the materials and supplied that are directly consumed for…
Q: total materials variance
A: Total materials variance = (Actual Quantity * Actual Price) - (Standard Quantity allowed for actual…
Q: Multiple Choice The material quantity variance is recorded when overhead is applied to production.…
A: Material Quantity Variance There are several costing techniques which was used to measure the total…
Q: Which of the following statements is true with respect to the materials price variance? Multiple…
A: Materials price variance = (Standard price - Actual price) x Actual Quantity purchased
Q: a. Direct materials price variance b. Direct materials quantity variance c. Direct materials cost…
A: Material variance is the difference between the actual cost of direct materials and the expected…
Q: Which of the following material issue pricin method considers the prices as well as the quantities…
A: Solution: "Weighted average method" considers the prices as well as the quantities of materials…
Q: a. Determine the direct materials price variance, direct materials quantity variance, and total…
A: Variances These are the differences between actual results for actual level of activity and the…
Q: 1. Calculate the total direct materials variance and total direct labour variance, together with…
A:
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- Materials and labor variances Fausto Fabricators Inc. uses a standard cost system to account for its single product. The standards established for the product include the following: The following operating data came from the records for the month: In process, beginning inventory, none. In process, ending inventory, 800 units, 80% complete as to labor; material is issued at the beginning of processing. Completed during the month, 5,600 units. Materials issued to production were 51,680 lb @ .55 per pound. Direct labor was 384,000 for 40,000 hours worked. Required: Calculate the following variances, using the diagram format in Figure 8-4. 1. Materials price. 2. Materials quantity. 3. Net materials variance. 4. Labor rate. 5. Labor efficiency. 6. Net labor variance. (Hint: Before determining the standard quantity for materials and labor, you must first compute the equivalent units of production for materials and labor.)Refer to the data in Exercise 9.15. Required: 1. Compute overhead variances using a two-variance analysis. 2. Compute overhead variances using a three-variance analysis. 3. Illustrate how the two- and three-variance analyses are related to the four-variance analysis. Oerstman, Inc., uses a standard costing system and develops its overhead rates from the current annual budget. The budget is based on an expected annual output of 120,000 units requiring 480,000 direct labor hours. (Practical capacity is 500,000 hours.) Annual budgeted overhead costs total 787,200, of which 556,800 is fixed overhead. A total of 119,400 units using 478,000 direct labor hours were produced during the year. Actual variable overhead costs for the year were 230,600, and actual fixed overhead costs were 556,250. Required: 1. Compute the fixed overhead spending and volume variances. How would you interpret the spending variance? Discuss the possible interpretations of the volume variance. Which is most appropriate for this example? 2. Compute the variable overhead spending and efficiency variances. How is the variable overhead spending variance like the price variances of direct labor and direct materials? How is it different? How is the variable overhead efficiency variance related to the direct labor efficiency variance?(Appendix) Calculating factory overhead: four variances Atlanta Adhesives Inc. budgets 15,000 direct labor hours for the year. The total overhead budget is expected to amount to 42,000. The standard cost for a unit of the companys product estimates the variable overhead as follows: The actual data for the period follow: Using the four-variance method, calculate the overhead variances. (Hint: First compute the budgeted fixed overhead rate.)
- Calculation of materials and labor variances Fritz Corp. manufactures and sells a single product. The company uses a standard cost system. The standard cost per unit of product follows: The charges to the manufacturing department for November, when 5,000 units were produced, follow: The Purchasing department normally buys about the same quantity as is used in production during a month. In November, 5,500 lb were purchased at a price of $2.90 per pound. Required: Calculate the following from standard costs for the data given, using the formulas on pages 421–422 and 424: Materials quantity variance. Materials purchase price variance (at time of purchase). Labor efficiency variance. Labor rate variance. Give some reasons as to why both the materials quantity variance and labor efficiency variance might be unfavorable.Direct materials and direct labor variance analysis Lenni Clothing Co. manufactures clothing in a small manufacturing facility. Manufacturing has 25 employees. Each employee presently provides 40 hours of productive labor per week. Information about a production week is as follows: Instructions Determine (A) the standard cost per unit for direct materials and direct labor; (B) the price variance, quantity variance, and total direct materials cost variance; and (C) the rate variance, time variance, and total direct labor cost variance.Direct materials, direct labor, and factory overhead cost variance analysis Mackinaw Inc. processes a base chemical into plastic. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of 40,000 units of product were as follows: Each unit requires 0.3 hour of direct labor. Instructions Determine (A) the direct materials price variance, direct materials quantity variance, and total direct materials cost variance; (B) the direct labor rate variance, direct labor time variance, and total direct labor cost variance; and (C) the variable factory overhead controllable variance, fixed factory overhead volume variance, and total factory overhead cost variance.
- Direct materials and direct labor variance analysis Faucet Industries Inc. manufactures faucets in a small manufacturing facility. The faucets are made from zinc. Faucet Industries has 60 employees. Each employee presently provides 36 hours of labor per week. Information about a production week is as follows: Instructions Determine (a) the standard cost per unit for direct materials and direct labor; (h) the price variance, quantity variance, and total direct materials cost variance; and (c) the rate variance, time variance, and total direct labor cost variance.Standard direct materials cost per unit from variance data The following data relating to direct materials cost for October of the current year are taken from the records of Good Clean Fun Inc., a manufacturer of organic toys: Determine the standard direct materials cost per unit of finished product, assuming that there was no inventory of work in process at either the beginning or the end of the month.Refer to Cornerstone Exercise 9.1. Guillermos Oil and Lube Company provided the following information for the production of oil changes during the month of June: Actual number of oil changes performed: 980 Actual number of direct labor hours worked: 386 hours Actual rate paid per direct labor hour: 14.50 Standard rate per direct labor hour: 14.00 Required: 1. Calculate the direct labor rate variance (LRV) and the direct labor efficiency variance (LEV) for June using the formula approach. 2. Calculate the direct labor rate variance (LRV) and the direct labor efficiency variance (LEV) for June using the graphical approach. 3. Calculate the total direct labor variance for oil changes for June. 4. What if the actual wage rate paid in June was 12.40? What impact would that have had on the direct labor rate variance (LRV)? On the direct labor efficiency variance (LEV)?
- Calculating factory overhead: two variances Munoz Manufacturing Co. normally produces 10,000 units of product X each month. Each unit requires 2 hours of direct labor, and factory overhead is applied on a direct labor hour basis. Fixed costs and variable costs in factory overhead at the normal capacity are 2.50 and 1.50 per direct labor hour, respectively. Cost and production data for May follow: a. Calculate the flexible-budget variance. b. Calculate the production-volume variance. c. Was the total factory overhead under- or overapplied? By what amount?Standard cost summary; materials and labor cost variances Perkins Processors Inc. produces an average of 10,000 units each month. The factory standards are 20,000 hours of direct labor and 10,000 pounds of materials for this volume. The standard cost of direct labor is 9.00 per hour, and the standard cost of materials is 4.00 per pound. The standard factory overhead at this level of production is 20,000. During the current month the production and cost reports reflected the following information: On the basis of this information: 1. Prepare a standard cost summary. 2. Calculate the materials (use the materials purchase price variance) and labor cost variances, and indicate whether they are favorable or unfavorable, using the formulas on pages 421422 and 424.Using variance analysis and interpretation Last year, Endicott Corp. adopted a standard cost system. Labor standards were set on the basis of time studies and prevailing wage rates. Materials standards were determined from materials specifications and the prices then in effect. On June 30, the end of the current fiscal year, a partial trial balance revealed the following: Standards set at the beginning of the year have remained unchanged. All inventories are priced at standard cost. What conclusions can be drawn from each of the four variances shown in Endicotts trial balance?