The records of Heritage Home Supplies show the following for July! Standard direct labor-hours allowed per unit of output Standard variable overhead rate per standard direct labor-hour Good units produced Actual direct labor-hours worked Actual total direct labor cost Direct labor efficiency variance. Actual variable overhead Direct labor Required: Compute the direct labor and variable overhead price and efficiency variances. Note: Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option. Price variance Efficiency variance Variable overhead 4 $38 3,680 14,225 Price variance Efficiency variance $521,000 $ 18,414 F $ 540,550
The records of Heritage Home Supplies show the following for July! Standard direct labor-hours allowed per unit of output Standard variable overhead rate per standard direct labor-hour Good units produced Actual direct labor-hours worked Actual total direct labor cost Direct labor efficiency variance. Actual variable overhead Direct labor Required: Compute the direct labor and variable overhead price and efficiency variances. Note: Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option. Price variance Efficiency variance Variable overhead 4 $38 3,680 14,225 Price variance Efficiency variance $521,000 $ 18,414 F $ 540,550
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter9: Standard Costing: A Functional-based Control Approach
Section: Chapter Questions
Problem 21E: Madison Company uses the following rule to determine whether direct labor efficiency variances ought...
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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