Question
In: Accounting
Top Hand company makes a tote bag and uses a standard cost system. Each tote bag...
Top Hand company makes a tote bag and uses a standard cost system. Each tote bag should use 2 yards of material that costs $5.00 per yard. Stitching on each bag should take a half hour of labor time of line workers who are paid an average wage of $20 per hour. Last month 15,000 tote bags were produced.
Looking at the production records, you find that $144,000 was spent to purchase the 32,000 yards of material used in production. Stitchers worked 7,200 hours and were paid $158,400.
You have been asked to produce a production report.
Required: Be sure to label each variance as F – favorable or U – unfavorable.
1. What is the standard materials costs for a tote bag and what is the standard labor cost to produce a tote bag?
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
Kansas Company uses a standard cost accounting system. In 2020, the company produced 27,700 units. Each...
Kansas Company uses a standard cost accounting system. In 2020,
the company produced 27,700 units. Each unit took several pounds of
direct materials and 1.6 standard hours of direct labor at a
standard hourly rate of $12.00. Normal capacity was 50,400 direct
labor hours. During the year, 131,500 pounds of raw materials were
purchased at $0.93 per pound. All materials purchased were used
during the year.
If the materials quantity variance was $19,665 unfavorable,
what was the standard materials quantity...
Kansas Company uses a standard cost accounting system. In 2017, the company produced 27,500 units. Each...
Kansas Company uses a standard cost accounting system. In 2017,
the company produced 27,500 units. Each unit took several pounds of
direct materials and 1.6 standard hours of direct labor at a
standard hourly rate of $11.00. Normal capacity was 49,500 direct
labor hours. During the year, 130,000 pounds of raw materials were
purchased at $0.90 per pound. All materials purchased were used
during the year.
(a)
If the materials price variance was $1,300 favorable, what was
the standard...
Under the old production system, it took 8 days to complete one tote bag. This is...
Under the old production system, it took 8 days to complete
one tote bag. This is a measure of?
With improvements in troubleshooting, Vuitton has been able
to reduce the number of returns on handbags at two of its
factories. This reduction in the number of flaws in its products is
an example of improvements in?
As a result of insufficient production rates, customers
were frequently being put on long waiting lists. By increasing
production capacity to meet increased demand,...
Wallis Company manufactures only one product and uses a standard cost system. The company uses a...
Wallis Company manufactures only one product and uses a standard
cost system. The company uses a predetermined plantwide overhead
rate that relies on direct labor-hours as the allocation base. All
of the company's manufacturing overhead costs are fixed—it does not
incur any variable manufacturing overhead costs. The predetermined
overhead rate is based on a cost formula that estimated $2,892,000
of fixed manufacturing overhead for an estimated allocation base of
289,200 direct labor-hours. Wallis does not maintain any beginning
or ending...
Phoenix Company manufactures only one product and uses a standard cost system. The company uses a...
Phoenix Company manufactures only one product and uses a
standard cost system. The company uses a plantwide predetermined
overhead rate that relies on direct labor-hours as the allocation
base. The predetermined overhead rate is based on a cost formula
that estimated $2,887,200 of fixed and variable manufacturing
overhead for an estimated allocation base of 240,600 direct
labor-hours. Phoenix does not maintain any beginning or ending work
in process inventory.
The company’s beginning balance sheet is as follows:
Phoenix Company
Balance...
Wallis Company manufactures only one product and uses a standard cost system. The company uses a...
Wallis Company manufactures only one product and uses a standard
cost system. The company uses a predetermined plantwide overhead
rate that relies on direct labor-hours as the allocation base. All
of the company's manufacturing overhead costs are fixed—it does not
incur any variable manufacturing overhead costs. The predetermined
overhead rate is based on a cost formula that estimated $2,886,000
of fixed manufacturing overhead for an estimated allocation base of
288,600 direct labor-hours. Wallis does not maintain any beginning
or ending...
The following is information related to X Company, a company that uses a standard cost system:...
The following is information related to X Company, a company
that uses a standard cost system:
Standard cost card for 1 unit of Product A:
Direct materials – Raw Material A (1 kilogram @ $
20/kg.)
$ 20
Direct materials – Raw Material B (1 kilogram @$
10/kg.) $ 10
Direct labour (1 hour @
$15/hr.)
$ 15
Variable overhead (1 hour @
$
5/hr.)
$ 5
Fixed overhead (1 hour @ $
10/hr.)
$ 10
Total budgeted fixed...
The following is information related to X Company, a company that uses a standard cost system:...
The following is information related to X Company, a company
that uses a standard cost system:
Standard cost card for 1 unit of Product A:
Direct materials – Raw Material A (1 kilogram @ $
20/kg.)
$ 20
Direct materials – Raw Material B (1 kilogram @$
10/kg.) $ 10
Direct labour (1 hour @
$15/hr.)
$ 15
Variable overhead (1 hour @
$
5/hr.)
$ 5
Fixed overhead (1 hour @ $
10/hr.)
$ 10
Total budgeted fixed...
West Manufacturing Company uses a standard cost system in its accounting records. The standard costs for...
West Manufacturing Company uses a standard cost system in its
accounting records. The standard costs for its one product are as
follows:
Materials
8 pounds at $1.00 = $ 8.00
Direct
labor
1.2 hours at $14.00 = 16.80
Variable overhead 1.2 direct-labor hours at
$4.00 = 4.80
Fixed overhead 1.2
direct-labor hours at $6.00 =
7.20
Total standard
cost
$36.80
The standard costs per unit are based on normal capacity of 3,600
direct-labor...
Griffen Company makes pipe using metal. The company uses a standard costing system. Variable overhead is...
Griffen Company makes pipe using metal. The company uses a
standard costing system. Variable overhead is allocated on the
basis of direct material usage (pounds). Overhead is allocated to
units based on expected production of 12,000 units. Griffen
maintains a materials inventory, so the amount of material used is
not necessarily the same as the amount of material purchased in any
one month. The standard cost sheet for a unit of pipe follows.
Direct material 6 pounds @ $ 5...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Baked potatoes are normally wrapped in aluminum foil. How does this affect the cooling of the...
- What is the process to obtain biomass production
- A labor market has 50,000 people in the labor force. Each month, a fraction p of...
- A road with a radius of 72 m is banked so that a car can navigate...
- 1) If you had not dried the solid, would the calculated percent yield have been higher,...
- Two structures of alanine can be drawn that have a net charge of zero, but the...
- Co(II) was used as an internal standard to analyze a sample of Ti(IV) with atomic absorption...
ADVERTISEMENT