The standard cost sheet for a product is shown. (Pleasee see attachment for original question overview) Manufacturing Costs Standard price Standard Quantity Standard Cost per unit Direct materials $4.50 per pound 5.50 pounds $24.75 Direct labor $12.15 per hour 2.10 hours $25.52 Overhead $2.40 per hour 2.10 hours $5.04 $55.31 The company produced 3,000 units that required: • 17,000 pounds of material purchased at $4.35 per pound • 6,200 hours of labor at an hourly rate of $12.45 per hour • Actual overhead in the period was $15,560 Fill in the Budget Performance Report for the period. Some amounts are provided. Round your answers to the nearest dollar. However, do not round your intermediate calculations. Budget Performance Report Manufacturing Costs: 3,000 units Actual Costs Standard Costs Variance (Favorable)/ Unfavorable Direct materials $73,950 $(fill in the blank) $(fill in the blank) Direct labor (fill in the blank) 76,545 (fill in the blank) Overhead 15,560 (fill in the blank) (fill in the blank) $(fill in the blank) $(fill in the blank) $785 Split the direct materials cost variance into the materials price varaince and the Direct materials quantity variance. Remember that you want to isolate the price variance from the quantity variance so be sure to use factors that do not overlap. Also remember that the two variances should equal the total direct material cost variance. Direct materials price variance: Direct materials quantity variance: (Actual price - Standard price) x quantity (Actual quantity - Standard quantity) x price __________ (actual/standard) quantity __________ (actual/standard) ,price ___________ ($2,250, $2,700, $2,550) (favorable/unfavorable) ___________ ($2,250, $2,700, $2,550) (favorable/unfavorable) Split the direct labor cost variance into the direct labor rate variance and the direct labor time variance. Remember that you want to isolate the price variance from the efficiency variance so be sure to use factors that do not overlap. Also remember that the two variances should equal the total direct labor cost variance. Direct labor rate variance: Direct labor time variance: (Actual rate - Standard rate) x hours (Actual hours - Standard hours) x labor rate __________ (actual/standard) hours __________ (actual/standard) labor rate ___________ ($1,860, $2,250) (favorable/unfavorable) ___________ ($1,215, $2,250) (favorable/unfavorable) Manufacturing variances are period costs that are rolled into _________ (revenue, cost of sales, assets, liabilities) and reported on the _________ (balance sheet, income statement). A favorable variance is recorded as a __________ (debit, credit) and an unfavorable variance is recorded as a ___________ (debit, credit).
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
The
(Pleasee see attachment for original question overview)
Standard price |
Standard Quantity |
Standard Cost per unit |
|
| Direct materials | $4.50 per pound | 5.50 pounds | $24.75 |
| Direct labor | $12.15 per hour | 2.10 hours | $25.52 |
| Overhead | $2.40 per hour | 2.10 hours | $5.04 |
| $55.31 |
The company produced 3,000 units that required:
• 17,000 pounds of material purchased at $4.35 per pound
• 6,200 hours of labor at an hourly rate of $12.45 per hour
• Actual overhead in the period was $15,560
Fill in the Budget Performance Report for the period. Some amounts are provided. Round your answers to the nearest dollar. However, do not round your intermediate calculations.
| Budget Performance Report | |||
|---|---|---|---|
Manufacturing Costs: 3,000 units |
Actual Costs |
Standard Costs |
Variance (Favorable)/ Unfavorable |
| Direct materials | $73,950 | $(fill in the blank) | $(fill in the blank) |
| Direct labor | (fill in the blank) | 76,545 | (fill in the blank) |
| Overhead | 15,560 | (fill in the blank) | (fill in the blank) |
| $(fill in the blank) | $(fill in the blank) | $785 |
Split the direct materials cost variance into the materials price varaince and the Direct materials quantity variance. Remember that you want to isolate the price variance from the quantity variance so be sure to use factors that do not overlap. Also remember that the two variances should equal the total direct material cost variance.
| Direct materials price variance: | Direct materials quantity variance: |
| (Actual price - Standard price) x quantity | (Actual quantity - Standard quantity) x price |
|
__________ (actual/standard) quantity |
__________ (actual/standard) ,price |
|
___________ ($2,250, $2,700, $2,550) (favorable/unfavorable) |
___________ ($2,250, $2,700, $2,550) (favorable/unfavorable) |
Split the direct labor cost variance into the direct labor rate variance and the direct labor time variance. Remember that you want to isolate the price variance from the efficiency variance so be sure to use factors that do not overlap. Also remember that the two variances should equal the total direct labor cost variance.
| Direct labor rate variance: | Direct labor time variance: |
| (Actual rate - Standard rate) x hours | (Actual hours - Standard hours) x labor rate |
| __________ (actual/standard) hours | __________ (actual/standard) labor rate |
| ___________ ($1,860, $2,250) (favorable/unfavorable) | ___________ ($1,215, $2,250) (favorable/unfavorable) |
Manufacturing variances are period costs that are rolled into _________ (revenue, cost of sales, assets, liabilities) and reported on the _________ (balance sheet, income statement). A favorable variance is recorded as a __________ (debit, credit) and an unfavorable variance is recorded as a ___________ (debit, credit).
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