Question
In: Accounting
Question 3: Variance Analysis (20 marks in total) You have introduced a standard cost accounting system...
Question 3: Variance Analysis (20 marks in total)
You have introduced a standard cost accounting system for FOL. The following standard costs have been developed for producing 1kg of the Cattle drench.
|
Direct materials (1 kilogram) |
$ 20 |
||||
|
Direct Labour (.25 hours) |
$ 15 |
||||
|
Overhead (DLH basis) |
$ 3 |
||||
|
$ 38 |
|||||
Production and cost information for May was:
|
Actual direct material purchased |
1200 |
kilograms |
|||
|
Actual direct materials issued |
900 |
kilograms |
|||
|
Actual output |
800 |
kilograms |
|||
|
Actual cost of materials purchased |
$ 25,500 |
||||
|
Actual direct labour rate |
$ 60 |
per hour |
|||
|
Actual direct labour hours |
280 |
||||
|
Actual overhead costs |
$ 4,500 |
||||
Required
- Calculate the following standard cost variances for May and provide general journal entries to record the cost flows for May.
(a) materials price
(b) materials usage
(c) direct labour rate
(d) direct labour efficiency
(e) total overhead
Solutions
ekkarill92 answered 5 hours agoRelated Solutions
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