Question
In: Statistics and Probability
A Mechanical design company produces an innovative design Component Z100 design of producing one(1) unit of...
A Mechanical design company produces an innovative design Component Z100 design of producing one(1) unit of component Z100 is provided in the bill of materials BOM which requires mix shown in Table Q3-1. The current monthly production of Component Z100 is consumption shown in Table Q3-2. Determine the following;
(i) Material usage variance;
(ii) Material price variance;
(iii) Total material cost variance;
(iv) Discuss at least two(2) importance of variance analysis in a manufacturing company
Table Q3-1
|
Materials |
Usage (units) |
Total cost (OMR) |
|
V |
5 |
17٫5 |
|
W |
3 |
37٫5 |
|
X |
8 |
52 |
|
Y |
2 |
40 |
Table Q3-2
|
Materials |
Usage (units) |
Total cost (OMR) |
|
V |
11،937 |
51،235 |
|
W |
6،854 |
94،382 |
|
X |
17،355 |
104،133 |
|
Y |
4،317 |
76،868 |
Solutions
orchestra answered 2 years agoRelated Solutions
A Mechanical design company produces an innovative design Component Z100 design of producing one(1) unit of...
A Mechanical design company produces an innovative design
Component Z100 design of producing one(1) unit of component Z100 is
provided in the bill of materials BOM which requires mix shown in
Table Q3-1. The current monthly production of Component Z100 is
consumption shown in Table Q3-2. Determine the following;
(i) Material usage variance;
(ii) Material price variance;
(iii) Total material cost variance;
(iv) Discuss at least two(2) importance of variance analysis in
a manufacturing company
Table Q3-1
Materials
Usage (units)...
1. The estimated costs of producing 6,000 units of a component are: Per Unit Total Direct...
1. The estimated costs of producing 6,000 units of a component
are:
Per Unit Total
Direct Material $10 $60,000
Direct Labor 8 48,000
Applied Variable Factory Overhead 9 54,000
Applied Fixed Factory Overhead 12 72,000
$1.5 per direct labor dollar
$39 $234,000
The same component can be purchased from market at a price of
$29 per unit. If the component is purchased from market, some
percentage of the fixed factory overhead will be saved.
a. Should the component be purchased...
Delta Company produces a single product. The cost of producing and selling a single unit of...
Delta Company produces a single product. The cost of producing
and selling a single unit of this product at the company’s normal
activity level of 103,200 units per year is:
Direct
materials
$
2.30
Direct
labor
$
3.00
Variable
manufacturing overhead
$
0.90
Fixed
manufacturing overhead
$
4.45
Variable selling
and administrative expenses
$
1.20
Fixed selling
and administrative expenses
$
2.00
The normal selling price is $22.00 per unit. The company’s
capacity is 139,200 units per year. An order...
Delta Company produces a single product. The cost of producing and selling a single unit of...
Delta Company produces a single product. The cost of producing
and selling a single unit of this product at the company’s normal
activity level of 104,400 units per year is:
Direct materials
$
1.50
Direct labor
$
3.00
Variable manufacturing
overhead
$
0.70
Fixed manufacturing
overhead
$
4.15
Variable selling and
administrative expenses
$
1.50
Fixed selling and administrative
expenses
$
2.00
The normal selling price is $23.00 per unit. The company’s
capacity is 136,800 units per year. An order...
Delta Company produces a single product. The cost of producing and selling a single unit of...
Delta Company produces a single product. The cost of producing
and selling a single unit of this product at the company’s normal
activity level of 86,400 units per year is:
Direct materials
$
2.10
Direct labor
$
2.00
Variable manufacturing
overhead
$
.60
Fixed manufacturing
overhead
$
4.15
Variable selling and
administrative expense
$
1.50
Fixed selling and administrative
expense
$
1.00
The normal selling price is $18 per unit. The company’s capacity
is 109,200 units per year. An order...
Delta Company produces a single product. The cost of producing and selling a single unit of...
Delta Company produces
a single product. The cost of producing and selling a single unit
of this product at the company’s normal activity level of 98,400
units per year is:
Direct
materials
$
2.50
Direct
labor
$
3.00
Variable
manufacturing overhead
$
1.00
Fixed
manufacturing overhead
$
4.45
Variable selling
and administrative expenses
$
1.30
Fixed selling
and administrative expenses
$
2.00
The normal selling
price is $18.00 per unit. The company’s capacity is 128,400 units
per year. An order...
Delta Company produces a single product. The cost of producing and selling a single unit of...
Delta Company produces a single product. The cost of producing
and selling a single unit of this product at the company’s normal
activity level of 104,400 units per year is:
Direct
materials
$
1.80
Direct
labor
$
2.00
Variable
manufacturing overhead
$
0.60
Fixed
manufacturing overhead
$
3.95
Variable selling
and administrative expenses
$
1.90
Fixed selling
and administrative expenses
$
1.00
The normal selling price is $22.00 per unit. The company’s
capacity is 118,800 units per year. An order...
Delta Company produces a single product. The cost of producing and selling a single unit of...
Delta Company produces a single product. The cost of producing
and selling a single unit of this product at the company’s normal
activity level of 102,000 units per year is: Direct materials $
1.70 Direct labor $ 4.00 Variable manufacturing overhead $ 0.70
Fixed manufacturing overhead $ 4.45 Variable selling and
administrative expenses $ 1.60 Fixed selling and administrative
expenses $ 3.00 The normal selling price is $24.00 per unit. The
company’s capacity is 132,000 units per year. An order...
Delta Company produces a single product. The cost of producing and selling a single unit of...
Delta Company produces a single product. The cost of producing
and selling a single unit of this product at the company’s normal
activity level of 103,200 units per year is:
Direct materials
$
1.70
Direct labor
$
3.00
Variable manufacturing overhead
$
0.90
Fixed manufacturing overhead
$
3.35
Variable selling and administrative expenses
$
1.90
Fixed selling and administrative expenses
$
2.00
The normal selling price is $19.00 per unit. The company’s
capacity is 127,200 units per year. An order...
Delta Company produces a single product. The cost of producing and selling a single unit of...
Delta Company produces a single product. The cost of producing
and selling a single unit of this product at the company’s normal
activity level of 86,400 units per year is:
Direct materials
$
2.10
Direct labor
$
2.00
Variable manufacturing overhead
$
0.50
Fixed manufacturing overhead
$
5.15
Variable selling and administrative expenses
$
1.30
Fixed selling and administrative expenses
$
1.00
The normal selling price is $21.00 per unit. The company’s
capacity is 102,000 units per year. An order...
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