Complete the grey boxes with the variance amounts and if the variance is favorab
ID: 2517891 • Letter: C
Question
Complete the grey boxes with the variance amounts and if the variance is favorable or unfavorable. Standard Costs/Quantities Actual Costs/Quantities Materials Cost $2.00 per unit $1.80 per unit Material Quantity 585000 pounds 640000 pounds Labor Cost $13.00 per hour $15.00 per hour Labor Hours 21000 hours 18900 hours Variable Overhead Rate $9.75 per labor hours $9.35 per labor hours Amount Favorable/Unfavorable Materials Price Variance Materials Cost Variance Labor Rate Variance Labor Efficiency Variance Variable Overhead Spending Variable Overhead Efficiency Complete the grey boxes with the variance amounts and if the variance is favorable or unfavorable. Standard Costs/Quantities Actual Costs/Quantities Materials Cost $2.00 per unit $1.80 per unit Material Quantity 585000 pounds 640000 pounds Labor Cost $13.00 per hour $15.00 per hour Labor Hours 21000 hours 18900 hours Variable Overhead Rate $9.75 per labor hours $9.35 per labor hours Amount Favorable/Unfavorable Materials Price Variance Materials Cost Variance Labor Rate Variance Labor Efficiency Variance Variable Overhead Spending Variable Overhead EfficiencyExplanation / Answer
Standard Cost: Amount F/UF Particulars Qty Rate Amount Material Price Variance: Material Cost 585000 2.00 1170000 (SP-AP)AQ Labor Cost 21000 13.00 273000 (2-1.80)*640000 128000 Favourable Variable OH 21000 9.75 204750 1647750 Material Efficiency Variance: (SQ-AQ)SP Actual Cost: (585000-640000)*2 -110000 Unfavourable Particulars Qty Rate Amount Material Cost 640000 1.80 1152000 Material Cost Variable 18,000 Favourable Labor Cost 18900 15.00 283500 (SC-AC) Variable OH 18900 9.35 176715 1612215 Labor Price Variance: (SP-AP)AQ (13-15)*18900 -37800 Unfavourable Short forms used: Labor Efficiency Variance: AQ Actual Quantity (SQ-AQ)SP SQ Standard Quantity (21000-18900)*13 27300 Favourable AP Actual Price SP Standard Price Labor Cost Variable -10,500 Unfavourable SC Standard Cost (SC-AC) AC Actual Cost VOH Spending Variance: (SP-AP)AQ (9.75-9.35)*18900 7560 Favourable VOH Efficiency Variance: (SQ-AQ)SP (21000-18900)*9.75 20475 Favourable Labor Cost Variable 28,035 Favourable (SC-AC)