Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Alpha Omega Industry uses standard-cost system and had the following standards for a unit of product: Quantity per unit 3.7 meter Cost per unit

  

Alpha Omega Industry uses standard-cost system and had the following standards for a unit of product: Quantity per unit 3.7 meter Cost per unit $18.50 $ 6.75 0.90 hour Variable manufacturing overhead 0.90 hour $ 2.25 Fixed manufacturing overhead 0.90 hour $ 2.70 The denominator activity for developing the budgeted manufacturing overhead is on the basis of direct labor hours for total budgeted units of 8,200. For the month just ended, the company produced 8,000 units and incurred the following: a. Purchased direct materials at $4.80 per meter at a total cost of $153,600 on account. b. Direct materials was issued to production, there was neither beginning nor ending direct materials inventory for the month. Direct material..... Direct labor.. Cost per quantity $5.00 per meter $7.50 per hour $2.50 per hour $3.00 per hour c. Direct labor incurred and paid at $8 per hour at a total cost of $51,200 d. Variable manufacturing overhead incurred totaled $17,600. e. Fixed manufacturing overhead incurred totaled $22,000. Question: 1. Compute the amount as direct materials price variance and state whether it is favorable or unfavorable. 2. Compute the amount as direct materials usage variance and state whether it is favorable or unfavorable. 3. Compute the amount as direct labor rate variance and state whether it is favorable or unfavorable. 4. Compute the amount as direct labor efficiency variance and state whether it is favorable or unfavorable. 5. Compute the amount as variable manufacturing overhead spending variance and state whether it is favorable or unfavorable. 6. Compute the amount as variable manufacturing overhead efficiency variance and state whether it is favorable or unfavorable. Variance balance 100000 Choose Favorable or Unfavorable

Step by Step Solution

3.52 Rating (159 Votes )

There are 3 Steps involved in it

Step: 1

To calculate the variances and determine whether they are favorable or unfavorable we need to compare the actual costs and quantities with the standar... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Management Accounting Information for Decision-Making and Strategy Execution

Authors: Anthony A. Atkinson, Robert S. Kaplan, Ella Mae Matsumura, S. Mark Young

6th Edition

137024975, 978-0137024971

More Books

Students also viewed these Accounting questions

Question

What type of consumers do you think are most likely to use ZipCar?

Answered: 1 week ago

Question

How do I feel just before I give in to my bad habit?

Answered: 1 week ago