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Requirement 1. What are the benefits of setting cost standards? Standard costing helps managers do the following Prepare the master budget Set target levels of perfomance for fexibie budpets dentity performance standards Set sales prices of products and servioes Decrease accounting costs Requirement 2. Calcuate the direct materials coat variance and the direct materials effciency variance as well as the dieect labor cost and efficiency variances. Begin with the cost variances. Select the required formulas, compute the cost variances for direct materials and direct labor, and identily whether each variance ia favorable (F) or untavorabie (U), (Abbreviations used ACactual cost. AQactual quartiny FOH feed overthead SC standard cost sa tandard quantty) Formula Variance Direct materiais cost variance Requirements Direct labor cost variance 1. What are the benefits of setting cost standards? Calculate the direct materials cost variance and the direct materials efficiency variance as well as the direct labor cost and efficiency variances. Print Done

Requirement 1. What are the benefits of setting cost standards? Standard costing helps managers do the following Prepare the master budget Set target levels of perfomance for fexibie budpets dentity performance standards Set sales prices of products and servioes Decrease accounting costs Requirement 2. Calcuate the direct materials coat variance and the direct materials effciency variance as well as the dieect labor cost and efficiency variances. Begin with the cost variances. Select the required formulas, compute the cost variances for direct materials and direct labor, and identily whether each variance ia favorable (F) or untavorabie (U), (Abbreviations used ACactual cost. AQactual quartiny FOH feed overthead SC standard cost sa tandard quantty) Formula Variance Direct materiais cost variance Requirements Direct labor cost variance 1. What are the benefits of setting cost standards? Calculate the direct materials cost variance and the direct materials efficiency variance as well as the direct labor cost and efficiency variances. Print Done

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter2: Basic Cost Management Concepts
Section: Chapter Questions
Problem 13E: Wyandotte Company provided the following information for the last calendar year: During the year,...
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Bargain, Inc. produced 1.000 units of the company's product in 2024. The standard quandity of direct materials was three yards of cloth per unit at a standard cost of $1.10 per yard. The accounting records showed that 2,800 yards of cioth were used and the company paid $1.15 per yard. Standard time was two direct labor hours per unit at a standard rate of $14.00 per direct labor hour. Employees worked 1,800 hours and were paid $13.50 per hour. Read the seauiements Requirement 1. What are the benefits of setting cost standards? Standard costing helps managers do the following Prepare the master budget Set target levels of perfomance for fleibie budgets dentity performance standards Set sales prices of products and services Decrease accounting costs Requirement 2. Calculate the direct materials cost variance and the direct materials efficiency variance as well as the direct labor cost and efficiency variances Begin with the cost variances. Select the required formulas, compute the cost variances for direct maberials and direct labor, and idently whether each variance ia favorable (F) or unfavorable (U). (Abbreviations used ACactual cost, AQactual quantity. FOH= fced overhead, SC = standard cost Sa standard quantty.) Formula Variance Direct materials oost variance Requirements Direct labor cost variance 1. What are the benefits of seting cost standards? 2. Calculate the direct materials cost variance and the direct materials efficiency variance as well as the direct labor cost and efficiency variances. Print Done
Transcribed Image Text:Bargain, Inc. produced 1.000 units of the company's product in 2024. The standard quandity of direct materials was three yards of cloth per unit at a standard cost of $1.10 per yard. The accounting records showed that 2,800 yards of cioth were used and the company paid $1.15 per yard. Standard time was two direct labor hours per unit at a standard rate of $14.00 per direct labor hour. Employees worked 1,800 hours and were paid $13.50 per hour. Read the seauiements Requirement 1. What are the benefits of setting cost standards? Standard costing helps managers do the following Prepare the master budget Set target levels of perfomance for fleibie budgets dentity performance standards Set sales prices of products and services Decrease accounting costs Requirement 2. Calculate the direct materials cost variance and the direct materials efficiency variance as well as the direct labor cost and efficiency variances Begin with the cost variances. Select the required formulas, compute the cost variances for direct maberials and direct labor, and idently whether each variance ia favorable (F) or unfavorable (U). (Abbreviations used ACactual cost, AQactual quantity. FOH= fced overhead, SC = standard cost Sa standard quantty.) Formula Variance Direct materials oost variance Requirements Direct labor cost variance 1. What are the benefits of seting cost standards? 2. Calculate the direct materials cost variance and the direct materials efficiency variance as well as the direct labor cost and efficiency variances. Print Done
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