Required: the variance analysis for labor.
Q: Production-volume variance formula
A: Variance: It implies to a difference between the actual and standard outcomes. If the actual outcome…
Q: Explain who is in the best position in the organization to influence each of these variances. a.…
A: Variance is a term used for measurement of variability. It computes the difference between the…
Q: Define direct labour cost variance.
A: Definition: Variance analysis: Variance analysis is the process of evaluating the differences…
Q: Why do we need to have a "base" for the computation of different types of variances under gross…
A: Gross Profit: It is calculated by subtracting operating expenses from the operating income for the…
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: 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: What is the direct labor rate variance
A: Solution: Direct labor rate variance is computed as = (SR - AR) *AH Where SR = Standard rate AR =…
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: t variances. Select the required formulas, compute the cost variances for direct materials and…
A: Variiances ariise when the actual results differs from standard or budgeted results. There are…
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: (b) Calculate the material quantity variance
A: Material quantity variance is also known as material usage variance. Formula: = ( Standard quantity…
Q: From the following data. Calculate Labour Variance The budgeted labour force for producing product A…
A: Solution Given for semi skilled workers Standard hour (SH) =20*50 =1000 Standard rate (SR)…
Q: Define the term cost variance.
A: Cost variance is the difference between actual costs and budgeted or estimated costs. Many of the…
Q: What is the overall variance in overhead?
A: Overhead refers to secondary expenditures spent during the manufacturing and distribution of…
Q: Among the given options, determine labor yield variance.
A: Formula: Labor Yield Variance= (Standard Mix for actual output- Actual mix for actual…
Q: 1. Compute the price and efficiency variances of direct materials and direct manufacturing labor.
A:
Q: List the direct labor variances, and briefly describe each.
A: Labor variance arises when the actual expenses associated with a labor activity varies from the…
Q: Determine a detailed list of possible causes of any material, labour or fixed overhead cost…
A: For any manufacturing industry It is important to set standards for the various activities like…
Q: What is the cost volume variance under 4-way analysis?
A: Cost volume variance shows difference in actual costs and budgeted costs due to difference in number…
Q: The direct-material quantity variance is:
A: Direct material quantity variance determines the efficiency of the production department in…
Q: what is the difference between fixed overhead budget variance and fixed overhead volume variance
A: The variance is the difference between the actual data and standard output of the production.
Q: MATERIALS MIX VARIANCE
A:
Q: The variance analysis is used Ratio Analysis Standard costing Budgetary control Marginal costing
A: Variance analysis is used to estimate the difference between the expected value and the actual…
Q: Define fixed overhead variance.
A: Fixed Overhead Variance is the difference between actual and absorbed fixed production overheads…
Q: 1. Compute the following variances for May: a. Materials price and quantity variances. b. Labor rate…
A: Since you have asked a question with multiple sub parts, we will solve the first three sub parts…
Q: Calculate labor rate and efficiency variances and the controllable overhead variance and the…
A: 1. Labor Rate Variance: = (Actual Hours x Standard Rate) - (Actual Hours x Actual Rate) 2. Labor…
Q: Give an example of a Direct Material Price Variance with figures and calculate the variance
A: Direct Material Price Variance is the difference between actual material cost and standard cost of…
Q: standard cost
A: Standard cost systems are cost accounting systems in which standard is set for each item of cost and…
Q: a. What is the material price usage, material quantity and total material variance D. What is the…
A: Material Quantity Variance-It is the difference between how much material used and expected to be…
Q: Explain an example how to calculate cost variance.
A: Cost variance is the difference of standard cost and actual cost in manufacturing of a product. Cost…
Q: How is the fixed overhead volume variance different from the other variances?
A: Variance: Variance refers to the difference level in the actual cost incurred and standard cost.…
Q: Compute overhead variances using a three-variance approach.
A: 1. Budgeted variance 2. Volume variance 3. Overhead variance
Q: Explain how the two-, three-, and four-variance overhead analyses are related.
A: Overhead variance is the difference between real and applied overhead. Overhead variance can only be…
Q: total materials variance
A: Total materials variance = (Actual Quantity * Actual Price) - (Standard Quantity allowed for actual…
Q: Based on the above information, the variable manufacturing overhead rate variance is?
A: Formula: Variable manfacturing overhead Rate Variance= Standard Rate- Actual Rate×Actual Hours of…
Q: List the fixed overhead variances, and briefly describe each.
A: Variance: Variance refers to the difference level in the actual cost incurred and standard cost.…
Q: Compute the direct labor rate and efficiency variances and identify each as favorable or…
A:
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- During the week of August 21, Parley Manufacturing produced and shipped 4,000 units of its machine tools: 1,500 units of Tool SK1 and 2,500 units of Tool SK3. The cycle time for SK1 is 0.73 hour, and the cycle time for SK3 is 0.56 hour. The following costs were incurred: Required: 1. Assume that the value-stream costs and total units shipped apply only to one model (a single-product value stream). Calculate the unit cost, and comment on its accuracy. 2. Assume that Tool SK1 is responsible for 60% of the materials cost. Calculate the unit cost for Tool SK 1 and Tool SK3, and comment on its accuracy. Explain the rationale for using units shipped instead of units produced in the calculation. 3. Calculate the unit cost for the two models, using DBC. Explain when and why this cost is more accurate than the unit cost calculated in Requirement 2.Algers Company produces dry fertilizer. At the beginning of the year, Algers had the following standard cost sheet: Algers computes its overhead rates using practical volume, which is 54,000 units. The actual results for the year are as follows: a. Units produced: 53,000 b. Direct materials purchased: 274,000 pounds at 2.50 per pound c. Direct materials used: 270,300 pounds d. Direct labor: 40,100 hours at 17.95 per hour e. Fixed overhead: 161,700 f. Variable overhead: 122,000 Required: 1. Compute price and usage variances for direct materials. 2. Compute the direct labor rate and labor efficiency variances. 3. Compute the fixed overhead spending and volume variances. Interpret the volume variance. 4. Compute the variable overhead spending and efficiency variances. 5. Prepare journal entries for the following: a. The purchase of direct materials b. The issuance of direct materials to production (Work in Process) c. The addition of direct labor to Work in Process d. The addition of overhead to Work in Process e. The incurrence of actual overhead costs f. Closing out of variances to Cost of Goods SoldCozy, Inc., manufactures small and large blankets. It estimates $350,000 in overhead during the manufacturing of 75,000 small blankets and 25,000 large blankets. What is the predetermined overhead rate if a small blanket takes 1 machine hour and a large blanket takes 2 machine hours?
- Standard unit cost and journal entries The normal capacity of Algonquin Adhesives Inc. is 40,000 direct labor hours and 20,000 units per month. A finished unit requires 6 lb of materials at an estimated cost of 2 per pound. The estimated cost of labor is 10.00 per hour. The plant estimates that overhead (all variable) for a month will be 40,000. During the month of March, the plant totaled 34,800 direct labor hours at an average rate of 9.50 an hour. The plant produced 18,000 units, using 105,000 lb of materials at a cost of 2.04 per pound. 1. Prepare a standard cost summary showing the standard unit cost. 2. Make journal entries to charge materials and labor to Work in Process.Queen Industries uses a standard costing system in the manufacturing of its single product. It requires 2 hours of labor to produce 1 unit of final product. In February, Queen Industries produced 12,000 units. The standard cost for labor allowed for the output was $90,000, and there was an unfavorable direct labor time variance of $5,520. A. What was the standard cost per hour? B. How many actual hours were worked? C. If the workers were paid $3.90 per hour, what was the direct labor rate variance?The following product costs are available for Kellee Company on the production of eyeglass frames: direct materials, $32,125; direct labor, $23.50; manufacturing overhead, applied at 225% of direct labor cost; selling expenses, $22,225; and administrative expenses, $31,125. The direct labor hours worked for the month are 3,200 hours. A. What are the prime costs? B. What are the conversion costs? C. What is the total product cost? D. What is the total period cost? E. If 6.425 equivalent units are produced, what is the equivalent material cost per unit? F. What is the equivalent conversion cost per unit?
- Remarkable Enterprises requires four units of part A for every unit of Al that it produces. Currently, part A is made by Remarkable, with these per-unit costs in a month when 4,000 units were produced: Variable manufacturing overhead is applied at $1.60 per unit. The other $0.50 of overhead consists of allocated fixed costs. Remarkable will need 8,000 units of part A for the next years production. Altoona Corporation has offered to supply 8,000 units of part A at a price of $8.00 per unit. If Remarkable accepts the offer, all of the variable costs and $2,000 of the fixed costs will be avoided. Should Remarkable accept the offer from Altoona Corporation?Business Specialty, Inc., manufactures two staplers: small and regular. The standard quantities of direct labor and direct materials per unit for the year are as follows: The standard price paid per pound of direct materials is 1.60. The standard rate for labor is 8.00. Overhead is applied on the basis of direct labor hours. A plantwide rate is used. Budgeted overhead for the year is as follows: The company expects to work 12,000 direct labor hours during the year; standard overhead rates are computed using this activity level. For every small stapler produced, the company produces two regular staplers. Actual operating data for the year are as follows: a. Units produced: small staplers, 35,000; regular staplers, 70,000. b. Direct materials purchased and used: 56,000 pounds at 1.5513,000 for the small stapler and 43,000 for the regular stapler. There were no beginning or ending direct materials inventories. c. Direct labor: 14,800 hours3,600 hours for the small stapler and 11,200 hours for the regular stapler. Total cost of direct labor: 114,700. d. Variable overhead: 607,500. e. Fixed overhead: 350,000. Required: 1. Prepare a standard cost sheet showing the unit cost for each product. 2. Compute the direct materials price and usage variances for each product. Prepare journal entries to record direct materials activity. 3. Compute the direct labor rate and efficiency variances for each product. Prepare journal entries to record direct labor activity. 4. Compute the variances for fixed and variable overhead. Prepare journal entries to record overhead activity. All variances are closed to Cost of Goods Sold. 5. Assume that you know only the total direct materials used for both products and the total direct labor hours used for both products. Can you compute the total direct materials and direct labor usage variances? Explain.April Industries employs a standard costing system in the manufacturing of its sole product, a park bench. They purchased 60,000 feet of raw material for $300,000, and it takes S feet of raw materials to produce one park bench. In August, the company produced 10,000 park benches. The standard cost for material output was $100,000, and there was an unfavorable direct materials quantity variance of $6,000. A. What is April Industries standard price for one unit of material? B. What was the total number of units of material used to produce the August output? C. What was the direct materials price variance for August?
- Jameson Company produces paper towels. The company has established the following direct materials and direct labor standards for one case of paper towels: During the first quarter of the year, Jameson produced 45,000 cases of paper towels. The company purchased and used 135,700 pounds of paper pulp at 0.38 per pound. Actual direct labor used was 91,000 hours at 12.10 per hour. Required: 1. Calculate the direct materials price and usage variances. 2. Calculate the direct labor rate and efficiency variances. 3. Prepare the journal entries for the direct materials and direct labor variances. 4. Describe how flexible budgeting variances relate to the direct materials and direct labor variances computed in Requirements 1 and 2.Gent Designs requires three units of part A for every unit of Al that it produces. Currently, part A is made by Gent, with these per-unit costs in a month when 4.000 units were produced: Variable manufacturing overhead is applied at $1.00 per unit. The other $0.30 of overhead consists of allocated fixed costs. Gent will need 6,000 units of part A for the next years production. Cory Corporation has offered to supply 6,000 units of part A at a price of $7.00 per unit. It Gent accepts the offer, all of the variable costs and $1,200 of the fixed costs will be avoided. Should Gent Designs accept the offer from Cory Corporation?Natur-Gro, Inc., manufactures composters. Based on past experience, Natur-Gro has found that its total annual overhead costs can be represented by the following formula: Overhead cost = 264,000 + 1.42X, where X equals number of composters. Last year, Natur-Gro produced 30,000 composters. Actual overhead costs for the year were as expected. Total overhead for per unit was a. 1.42 b. 8.80 c. 11.63 d. 10.22