Highland Company produces a lightweight backpack that is popular with college st
ID: 2469442 • Letter: H
Question
Highland Company produces a lightweight backpack that is popular with college students. Standard variable costs relating to a single backpack are given below:
Overhead is applied to production on the basis of direct labor-hours. During March, 720 backpacks were manufactured and sold. Selected information relating to the month’s production is given below:
What was the actual cost per backpack produced during March? (Round your answers to 2 decimal places.)
$0.00
How many yards of material are required at standard per backpack?
What was the materials price variance for March if there were no beginning or ending inventories of materials? (Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)
Thank you
Highland Company produces a lightweight backpack that is popular with college students. Standard variable costs relating to a single backpack are given below:
Explanation / Answer
Ans-
1 What is the standard cost of a single backpack 1 standard cost for march production : Materials $14,688 Direct labour 13,248 Variable manufacturing overhead 2,304 Total standard cost (a) 30,240 Number of backpacks produced (b) 720 standard cost of single bacvkpack a/b $42.00 2 Standard cost of single backpack (above) $42.00 Less difference between standard and actual cost 0.25 Actual cost per backpack $41.75 3 Total standard cost of materials allowed during march (a) $14,688 Number of backpacks produced during march (b) 720 Standard materials cost per backpacks a/b $20.40 Standard materials cost per backpack $20.40 per backpack Standard material cost per yard $5.10 per yard 4 yards per backpack 4 Standard cost of material used $14,688 Actual cost of material used 12,218 Total variance $2,470 F The price and quantity variances together equal the total variances. If the quantity variances is $510 U. then the price variance must be $2,980 F: Price variance $2,980 F Quantity variance 510 U Total variance $2,470 F