Question
In: Accounting
James company makes a product that should use 6 pounds of material that should cost $3...
James company makes a product that should use 6 pounds of material that should cost $3 per pound according to the cost standards. Each unit requires 2 hours of labor that should cost $18 per hour. James made 1,500 units of the product last month.
When you look at the accounting records for the month, you see that 8,500 pounds of material were purchased at a cost of $27,200 and 3,200 hours of labor were used at a cost of $56,960.
Required: Be sure to label each variance as F – favorable or U – unfavorable.
1. What is the standard materials costs for a unit of product and what is the standard labor cost to produce a unit of product?
2. What were the total direct materials and direct labor variances?
3. Calculate the following variance breakdowns for last month’s production:
Materials price variance
Materials usage variance
Labor price (rate) variance
Labor usage (efficiency) variance
Solutions
ekkarill92 answered 2 years agoRelated Solutions
Cost standards for one unit of product no. C 1895: Direct material 3 pounds at $2.70...
Cost standards for one unit of product no. C 1895: Direct
material 3 pounds at $2.70 per pound $ 8.10 Direct labor 7 hours at
$7.70 per hour 53.90 Actual results: Units produced 5,600 units
Direct material purchased 26,200 pounds at $2.90 $ 75,980 Direct
material used 16,500 pounds at $2.90 47,850 Direct labor 40,300
hours at $7.50 302,250 Assume that the company computes variances
at the earliest point in time. The direct-material price variance
is:
Multiple Choice None of...
A company makes and sells a single product, the variable cost of the production is $3...
A company makes and sells a single product, the variable cost of
the production is $3 per unit
and variable cost of selling is $1 per unit, fixed cost totalled
$600, and the selling price per unit
was $6. The company budgeted to make and sell 3 000 units in the
next year.
Required
Prepare a break even chart showing the expected amount of the
output and sales required to
break even.
Legalos Company makes and sells a single product. It takes seven pounds of direct materials to...
Legalos Company makes and sells a single product. It takes seven pounds of
direct materials to produce one unit of this product. Budgeted production
for the next three months is given below:
Budgeted Units to be Produced
February 18,500 units
March 19,200 units
April 14,300 units
The company wants to maintain monthly ending inventories of direct materials
that are equal to 54% of the following month's production needs. The cost of
direct materials is $1.50 per pound.
Calculate the total...
ABC Company makes and sells a single product. It requires 2.5 pounds of direct materials to...
ABC Company makes and sells a single product. It requires
2.5 pounds of direct materials to produce one unit of this
product. Budgeted units to be produced for the next four
months is given below:
Budgeted Units to be Produced
July 35,000 units
August 31,000 units
September 11,000 units
October 34,000 units
The company wants to maintain monthly ending inventories of
direct materials equal to 36% of the next month's production
needs. The cost of direct materials is $9 per...
Legalos Company makes and sells a single product. It takes seven pounds of direct materials to...
Legalos Company makes and sells a single product. It takes seven pounds of
direct materials to produce one unit of this product. Budgeted production
for the next three months is given below:
Budgeted Units to be Produced
February 18,500 units
March 19,200 units
April 14,300 units
The company wants to maintain monthly ending inventories of direct materials
that are equal to 54% of the following month's production needs. The cost of
direct materials is $1.50 per pound.
1. Calculate the...
Legalos Company makes and sells a single product. It takes seven pounds of direct materials to...
Legalos Company makes and sells a single product. It takes seven pounds of
direct materials to produce one unit of this product. Budgeted production
for the next three months is given below:
Budgeted Units to be Produced
February 18,500 units
March 19,200 units
April 14,300 units
The company wants to maintain monthly ending inventories of direct materials
that are equal to 45% of the following month's production needs. The cost of
direct materials is $1.60 per pound.
Calculate the total...
standard cost sheet for one unit of the product. Direct materials (6 pounds at $1.60 per...
standard cost sheet for one unit of the product.
Direct materials (6 pounds at $1.60 per pound)
$9.60
Direct labor (6 hours at $10.00 per hour)
$60.00
During the month of April, the company manufactures 310 units
and incurs the following actual costs.
Direct materials purchased and used (2,400 pounds)
$4,080
Direct labor (1,880 hours)
$18,612
What is the total, price, and quantity variances for materials
and labor.
Degregorio Corporation makes a product that uses a material with the following direct material standards: Standard...
Degregorio Corporation makes a product that uses a material with
the following direct material standards: Standard Quantity is 3.8
kilos per unit; Standard price is $7.00 per kilo. The company
produced 5,600 units in November using 21,750 kilos of the
material. During the month, the company purchased 24,800 kilos of
the direct material at a total cost of $168,640. The direct
materials purchases variance is computed when the direct materials
are purchased. The direct materials purchase price variance for
November...
Dodd Company makes and sells a single product. Each finished unit requires four pounds of direct...
Dodd Company makes and sells a single product. Each finished unit requires
four pounds of direct materials. The budgeted units to be produced for the
third quarter of the current year are given below:
Budgeted Units to be Produced
July 26,000 units
August 21,000 units
September 33,000 units
The company wants to maintain monthly ending inventories of direct materials
equal to 35% of the next month's production needs. The cost of the direct
materials is $1.75 per pound.
Calculate the...
Russell Manufacturing makes a product that uses a material with the following standards:
Russell Manufacturing makes a product that uses a material
with the following standards: Standard quantity... 3.0 kilos per
unit Standard price... $2.00 per kilo Standard cost... $6.00 per
unit The company budgeted for production of 1,300 units in April,
but actual production was 1,200 units. The company used 3,750 kilos
of direct material to produce this output. The company purchased
3,700 kilos of the direct material at a total cost of $8,200 The
direct materials purchases variance is computed when...
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