Question
1. The following data relate to factory overhead cost for the production of 7,000 computers: Actual: Variable factory overhead $174,800 Fixed factory overhead 46,750 Standard:
1.
The following data relate to factory overhead cost for the production of 7,000 computers:
Actual: | Variable factory overhead | $174,800 |
Fixed factory overhead | 46,750 | |
Standard: | 7,000 hrs. at $30 | 210,000 |
If productive capacity of 100% was 11,000 hours and the total factory overhead cost budgeted at the level of 7,000 standard hours was $227,000, determine the variable factory overhead controllable variance, fixed factory overhead volume variance, and total factory overhead cost variance. The fixed factory overhead rate was $4.25 per hour. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.
Variance | Amount | Favorable/Unfavorable |
Variable factory overhead controllable variance | $ | |
Fixed factory overhead volume variance | ||
Total factory overhead cost variance | $ |
|
2.
Mackinaw Inc. processes a base chemical into plastic. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of 5,600 units of product were as follows:
Standard Costs | Actual Costs | ||
Direct materials | 7,300 lb. at $5.70 | 7,200 lb. at $5.60 | |
Direct labor | 1,400 hrs. at $17.50 | 1,430 hrs. at $17.80 | |
Factory overhead | Rates per direct labor hr., | ||
based on 100% of normal | |||
capacity of 1,460 direct | |||
labor hrs.: | |||
Variable cost, $3.40 | $4,710 variable cost | ||
Fixed cost, $5.40 | $7,884 fixed cost |
Each unit requires 0.25 hour of direct labor.
Required:
a. Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.
Direct materials price variance | $ | |
Direct materials quantity variance | ||
Total direct materials cost variance | $ |
b. Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.
Direct labor rate variance | $ | |
Direct labor time variance | ||
Total direct labor cost variance | $ |
c. Determine variable factory overhead controllable variance, the fixed factory overhead volume variance, and total factory overhead cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.
Variable factory overhead controllable variance | $ | |
Fixed factory overhead volume variance | ||
Total factory overhead cost variance | $ |
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