Chapter 10 Question 2
10 points eBock Pm References M Eecton Labs, Inc., produces various chemical compounds for industrial use. One compound. called Fludex. is prepared using an elaborate distilling process. The company has developed standard costs for one unit of Fludex, as follows: Standard Quantity or Hours Direct materials 2.30 ounces Direct labor 0.80 hours Variable manufacturing overhead 0.80 hours Total standard cost per unit Standard Prioa standard or Rate Cost: $24.00 per ounce $55.20 $15.00 per hour 12.00 $ 3.50 per hour A s7n.nn During November, the following activity was recorded related to the production of Fludex: .U'FJ Materials purchased, 12.500 ounces at a cost of $282,500. There was no beginning inventory of materials; however. at the end of the month, 3,000 ounces of material remained in ending inventory. The company employs 25 lab technicians to work on the production of Fludex. During November, they each worked an average of 150 hours at an average pay rate of $14.00 per hour. Variable manufacturing overhead is assigned to Fludex on the basis of direct labor-hours. Variable manufacturing overhead costs during November totaled $8,000. During November, the company produced 4,100 units of Fludex. Check my work 2 Required: 1. For direct materials: a. Compute the price and quantity variances. 10 b. The materials were purchased from a new supplier who is anxious to enter into a long-term purchase contract. Would you points recommend that the company sign the contract? 2. For direct labor: eBook a. Compute the rate and efficiency variances. b. In the past, the 26 technicians employed in the production of Fludex consisted of 4 senior technicians and 22 assistants. During Print November, the company experimented with fewer senior technicians and more assistants in order to reduce labor costs. Would you recommend that the new labor mix be continued? References 3. Compute the variable overhead rate and efficiency variances. Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2A Req 2B Req 3 Compute the variable overhead rate and efficiency variances. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)Check my work 2 VULLIPICLE WHIS YUCELIUIL By CHILCLINIg JULI JUSTICES IH WIC LAUD UCIUW. Req 1A Req 1B Req 2A Req 2B Req 3 10 points For direct materials, compute the price and quantity variances. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) eBook Materials price variance Print Materials quantity variance References Check my work 2 3. Compute the variable overhead rate and efficiency variances. Complete this question by entering your answers in the tabs below. 10 points Req 1A Req 1B Req 2A Req 2B Req 3 eBook For direct materials, the materials were purchased from a new supplier who is anxious to enter into a long-term purchase contract. Would you recommend that Print the company sign the contract? References OYes No Check my work 2 3. Compute the variable overhead rate and efficiency variances. Complete this question by entering your answers in the tabs below. 10 points Req 1A Req 1B Req 2A Req 2B Req 3 eBook For direct labor, compute the rate and efficiency variances. (Indicate the effect of each variance by selecting "F for favorable, "U" for unfavorable, and "None" Print for no effect (i.e., zero variance). Input all amounts as positive values.) References Labor rate variance Labor efficiency variance Check my work 2 3. Compute the variable overhead rate and efficiency variances. Complete this question by entering your answers in the tabs below. 10 points Req 1A Req 1B Req 2A Req 2B Req 3 eBook In the past, the 26 technicians employed in the production of Fludex consisted of 4 senior technicians and 22 assistants. During November, the company Print experimented with fewer senior technicians and more assistants in order to reduce labor costs. Would you recommend that the new labor mix be continued? References Yes No Check my work 2 3. Compute the variable overhead rate and efficiency variances. Complete this question by entering your answers in the tabs below. 10 points Req 1A Req 1B Req 2A Req 2B Req 3 eBook Compute the variable overhead rate and efficiency variances. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and Print "None" for no effect (i.e., zero variance). Input all amounts as positive values.) References Variable overhead rate variance Variable overhead efficiency variance
