A B D E F G H 1 4 PART 6 5 6 Standard Job Order Costing - 7 Variance Analysis 8 9 10 11 14 Special order lamps are manufactured in division S. Because of the precise nature of the process a 15 standard cost system has been developed. The following standards are used for the special orders: 16 17 18 21 Standards 22 Lamp Kits $ 16.000000 per lamp 23 Direct Labor 2.400000 per lamp (4 lamps/hr.) 24 Variable Overhead 0.250000 per lamp (4 lamps/hr.) 25 ** Fixed Overhead 10.000000 per lamp 28 Total $28.650000 29 30 ** Fixed overhead is based on expected production of 4,010 customized lamps each month. 31 32 To keep records of the actual cost of a job, a Job Order Cost System has been developed. Entries 35 are made to the Job Order System at actual cost (overhead is applied based on actual labor hours) 36 while entries are made to the accounting system at standard. Variance analysis is used to analyze the 37 differences. 38 39 42 43 Job Order Costing Section 44 45 On January 1, 20x2, Division S began Job 1101 for the Client, THE BIG CHILDREN STORE. The 46 job called for 4,000 customized lamps. The following set of transactions occurred from 49 January 5 until the job was completed: 50 51 52 5-Jan Purchased 4,225 Lamp Kits @ $16.30 per kit. 53 9-Jan 4,125 sets of Lamp Kits were requisitioned. 56 17-Jan Payroll of 630 Direct Labor Hours @ $9.70 per hour. 57 30-Jan Payroll of 680 Direct Labor Hours @ $9.95 per hour. 58 30-Jan 3,990 lamps were completed and shipped. All materials requisitioned were 59 used or scrapped. 60 63 64 4 6 A 7 8 9 Ready 4 5 6 7 8 9 10 How many Lamps were completed? Note: Show favorable variances as negative numbers Round dollars to two places, $##.## $ 1,267.50 {15.01} {15.02} 11 12 16 17 What was the total material price variance for the Lamp Kits purchased? 18 19 20 24 What was the material usage variance for Lamp Kits? 25 26 27 28 32 33 34 What was the direct labor efficiency variance ? 35 36 40 41 What was the direct labor rate variance? 42 43 44 48 49 {15.03} {15.04} 4 5 Note: Show favorable variances as negative numbers LOON 0009 7 8 {16.01} {16.02} 10 11 12 13 18 What was the variable overhead efficiency variance ? 19 20 21 22 27 What was the variable OH spending variance ? 28 29 30 31 36 37 38 39 40 45 What is the fixed OH volume (denominator) variance? 46 47 48 49 54 55 56 57 What is the fixed OH spending variance? 58 63 {16.03} {16.04}