Requirement 1. Compute the direct material price variance and the direct material quantity variance. (Enter the variances as positive numbers. Enter currency amounts in the formula to the nearest cent and then round the final variance amount to the nearest whole dollar. Label the variance as favorable (F) or unfavorable (U). Abbreviations used: DM = Direct materials) First determine the formula for the price variance, then compute the price variance for direct materials. Standards Actual hours - DM price variance Direct materials (rosin).. 14 pounds per pot at a cost of $6.00 per .pound - X 3.0 hours at a cost of $21.00 per hour Direct labor.... Actual Results Standard variable manufacturing overhead rate $7.00 per direct labor hour Budgeted fixed manufacturing overhead $29,000 Standard fixed MOH rate GrandScapes allocated fixed manufacturing overhead to production based on standard direct labor hours. Last month, the company reported the following actual results for the production of 2,000 flower pots: $5.00 per direct labor hour (DLH) ... Purchased 29,200 pounds at a cost of $6.20 per pound; . used 28,600 pounds to produce 2.000 pots Direct materials Requirements Worked 3.5 hours per flower pot (7,000 total DLH) at a Direct labor......................cost of $19.00 per hour Actual variable manufacturing overhead....................... $7.70 per direct labor hour for total actual variable . manufacturing overhead of $53,900 1. Compute the direct material price variance and the direct maturial quantity variance. Actual fixed manufacturing overhead $28,600 Standard fixed manufacturing 2. Who is generally responsible for each variance? 3. Interpret the variances. overhead allocated based on actual production... ....................530,000
Requirement 1. Compute the direct material price variance and the direct material quantity variance. (Enter the variances as positive numbers. Enter currency amounts in the formula to the nearest cent and then round the final variance amount to the nearest whole dollar. Label the variance as favorable (F) or unfavorable (U). Abbreviations used: DM = Direct materials) First determine the formula for the price variance, then compute the price variance for direct materials. Standards Actual hours - DM price variance Direct materials (rosin).. 14 pounds per pot at a cost of $6.00 per .pound - X 3.0 hours at a cost of $21.00 per hour Direct labor.... Actual Results Standard variable manufacturing overhead rate $7.00 per direct labor hour Budgeted fixed manufacturing overhead $29,000 Standard fixed MOH rate GrandScapes allocated fixed manufacturing overhead to production based on standard direct labor hours. Last month, the company reported the following actual results for the production of 2,000 flower pots: $5.00 per direct labor hour (DLH) ... Purchased 29,200 pounds at a cost of $6.20 per pound; . used 28,600 pounds to produce 2.000 pots Direct materials Requirements Worked 3.5 hours per flower pot (7,000 total DLH) at a Direct labor......................cost of $19.00 per hour Actual variable manufacturing overhead....................... $7.70 per direct labor hour for total actual variable . manufacturing overhead of $53,900 1. Compute the direct material price variance and the direct maturial quantity variance. Actual fixed manufacturing overhead $28,600 Standard fixed manufacturing 2. Who is generally responsible for each variance? 3. Interpret the variances. overhead allocated based on actual production... ....................530,000
Chapter8: Standard Costs And Variances
Section: Chapter Questions
Problem 5PA: Ed Co. manufactures two types of O rings, large and small. Both rings use the same material but...
Related questions
Question
1
Transcribed Image Text:GrandScapes is a manufacturer of large flower pots for urban settings. The cormpany has these standards:
E (Click the icon to view the standards.)
E (Click the icon to view the actual results.)
Read the requirements.
Requirement 1. Compute the direct material price variance and the direct material quantity variance. (Enter the variances as positive numbers. Enter currency amounts in the formula to the nearest cent and then round the final variance amount
to the nearest whole dollar. Label the variance as favorable (F) or unfavorable (U). Abbreviations used: DM = Direct materials)
First determine the formula for the price variance, then compute the price variance for direct materials.
Standards
*(
Actual hours
) = DM price variance
14 pounds per pot at a cost of $6.00 per
pound
Direct materials (resin).
Direct labor...........
3.0 hours at a cost of $21.00 per hour
Actual Results
Standard variable manufacturing overhead rate...
$7.00 per direct labor hour
Budgeted fixed manufacturing overhead
.$29,000
GrandScapes allocated fixed manufacturing overhead to production based on standard direct labor
hours. Last month, the company reported the following actual results for the production of 2,000
flower pots:
Standard fixed MOH rate
$5.00 per direct labor hour (DLH)
Purchased 29,200 pounds at a cost of $6.20 per pound;
- X
Direct materials
. used 28,600 pounds to produce 2,000 pots
Requirements
Worked 3.5 hours per flower pot (7,000 total DLH) at a
Direct labor -...****
. cost of $19.00 per hour
Actual variable manufacturing
$7.70 per direct labor hour for total actual variable
1. Compute the direct material price variance and the direct material quantity
overhead..
...................... manufacturing overhead of $53,900
variance.
Actual fixed manufacturing overhead $28,600
Standard fixed manufacturing
2. Who is generally responsible for each variance?
3. Interpret the variances.
overhead allocated based on actual
production....................... $30,000
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Principles of Cost Accounting
Accounting
ISBN:
9781305087408
Author:
Edward J. Vanderbeck, Maria R. Mitchell
Publisher:
Cengage Learning
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Principles of Cost Accounting
Accounting
ISBN:
9781305087408
Author:
Edward J. Vanderbeck, Maria R. Mitchell
Publisher:
Cengage Learning
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Excel Applications for Accounting Principles
Accounting
ISBN:
9781111581565
Author:
Gaylord N. Smith
Publisher:
Cengage Learning
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub