Standard Cost and Budgeted Cost

Seven Manufacturing Corporation uses both standards and budgets. The company estimates that production for the year will be 100,000 units of Product Fast. To produce these units of Product Fast, the company expects to spend $600,000 for materials and $800,000 for labor.

Instructions : Compute the estimates for (a) standard cost and (b) budgeted cost.

Solutions

Expert Solution

Standard Cost is the cost per unit, and budgeted is the total cost. Since the question already mentioned the total amount of the cost, we only need to divide it by the total unit to find the Standard Cost, and use the cost that mentioned before for the Budgeted Cost.

A	Standard Cost (Unit Amount)
	Direct Material
	600000/100000=	6

	Direct Labor
	800000/100000 =	8

B	Budgeted Cost (Total Amount)
	Direct Material = 600000
	Direct Labor = 800000

Ucok answered 2 years ago

Next > < Previous

Related Solutions

A variance is the difference between a budgeted, planned, or standard cost and the actual amount...

A variance is the difference between a budgeted, planned, or standard cost and the actual amount incurred/sold. Variances can be computed for both costs and revenues. Identify and explain the types of variance analysis tools, which can be used in a production department of a manufacturing company, which specialises in spare parts for cars

Budgeted cost of a single unit Standard based on perfect conditions Standard based on attainable conditions...

Budgeted cost of a single unit Standard based on perfect conditions Standard based on attainable conditions Standard quantity of direct materials multiplied by standard price of direct Should explain direct labor rate variances Should know why the company was able to purchase materials at a better Tells managers how much of the total variance is due to using a larger or smaller quantity of direct materials than expected Tells managers how much of the total labor variance is due to...

Bluecap Co. uses a standard cost system and flexible budgets for control purposes. The following budgeted...

Bluecap Co. uses a standard cost system and flexible budgets for control purposes. The following budgeted information pertains to 2019: Denominator volume—number of units 9,000 Denominator volume—percent of capacity 90 % Denominator volume—standard direct labor hours (DLHs) 27,000 Budgeted variable factory overhead cost at denominator volume $ 103,700 Total standard factory overhead rate per DLH $ 15.10 During 2019, Bluecap worked 26,000 DLHs and manufactured 9,100 units. The actual factory overhead cost for the year was $13,000 greater than the...

Bluecap Co. uses a standard cost system and flexible budgets for control purposes. The following budgeted...

Bluecap Co. uses a standard cost system and flexible budgets for control purposes. The following budgeted information pertains to 2016: Denominator volume-number of units 8,000 Denominator volume-percent of capacity 80% Denominator volume-standard direct labor hours 24,000 Budgeted variable factory overhead cost at the denominator volume $103,200 Total standard factory overhead rate per direct labor hour $15.10 During 2016, Bluecap worked 28,000 direct labor hours and manufactured 9,600 units. The actual factory overhead was $14,000 greater than the flexible budget amount...

Bluecap Co. uses a standard cost system and flexible budgets for control purposes. The following budgeted...

Bluecap Co. uses a standard cost system and flexible budgets for control purposes. The following budgeted information pertains to 2019: Denominator volume—number of units 8,000 Denominator volume—percent of capacity 80%Denominator volume—standard direct labor hours (DLHs) 24,000 Budgeted variable factory overhead cost at denominator volume$103,200 Total standard factory overhead rate per DLH$15.10 During 2019, Bluecap worked 28,000 DLHs and manufactured 9,600 units. The actual factory overhead cost for the year was $14,000 greater than the flexible budget amount for the units...

Bluecap Co. uses a standard cost system and flexible budgets for control purposes. The following budgeted...

Bluecap Co. uses a standard cost system and flexible budgets for control purposes. The following budgeted information pertains to 2019: Denominator volume—number of units 7,000 Denominator volume—percent of capacity 70 % Denominator volume—standard direct labor hours (DLHs) 35,000 Budgeted variable factory overhead cost at denominator volume $ 102,700 Total standard factory overhead rate per DLH $ 15.10 During 2019, Bluecap worked 44,000 DLHs and manufactured 9,000 units. The actual factory overhead cost for the year was $15,000 greater than the...

3. Dow Company manufactures tables in U.S. The standard (budgeted) cost of one unit is shown...

3. Dow Company manufactures tables in U.S. The standard (budgeted) cost of one unit is shown below: Direct materials 9 pounds at $4 per pound $36 Direct labour 2 hours at $45 per hour 90 Variable manufacturing overhead* 2 hours at $15 per hour 30 Total standard variable cost per unit $156 *The variable manufacturing overhead rate is based on direct labour hour. During March, 8,000 units were produced. The company purchased 80,000 pounds of direct materials at a cost...

1.) If budgeted beginning inventory is $8,800, budgeted ending inventory is $10,000, and budgeted cost of...

1.) If budgeted beginning inventory is $8,800, budgeted ending inventory is $10,000, and budgeted cost of goods sold is $10,760, budgeted purchases should be: $1,960 $760 $11,960 $1,200 $9,560 2.) Use the following information to determine the ending cash balance to be reported on the month ended June 30 cash budget. a. Beginning cash balance on June 1, $94,900. b. Cash receipts from sales, $417,500. c. Budgeted cash disbursements for purchases, $272,500. d. Budgeted cash disbursements for salaries, $95,900. e....

The standard variable overhead cost rate for Harris Manufacturing is $30.00 per unit. Budgeted fixed overhead...

The standard variable overhead cost rate for Harris Manufacturing is $30.00 per unit. Budgeted fixed overhead cost is $38,700. Harris Manufacturing budgeted 4,300 units for the current period and actually produced 4,400 finished units. What is the fixed overhead volume variance? Assume the allocation base for fixed overhead costs is the number of units expected to be produced. A. $900 favorable B. $3,000 favorable C. $3,000 unfavorable D. $900 unfavorable

The following information is for the standard and actual costs for Happy Corporation: Standard Costs: Budgeted...

The following information is for the standard and actual costs for Happy Corporation: Standard Costs: Budgeted units of production 16,000 [80% (or normal) capacity] Standard labor hours per unit 4 Standard labor rate $26 per hour Standard material per unit 8 lbs. Standard material cost $12 per pound Standard variable overhead rate $15 per labor hour Budgeted fixed overhead $640,000 Fixed overhead rate is based on budgeted labor hours at 80% (or normal) capacity. Actual Costs: Actual production 16,500 units...

Subjects