Question
Cox Engineering performs cement core tests in its laboratory. The following standards have been set for each core test performed: Direct materials 3 pounds of
Cox Engineering performs cement core tests in its laboratory. The following standards have been set for each core test performed:
Direct materials 3 pounds of sand $.75 per pound
Direct labor 0.4 hours $12 per hour
Variable overhead 0.4 hours $9 per hour
During March, the laboratory performed 2,000 core tests. On March 1, there were no direct materials (sand) on hand. After sand is used for a core test, it is discarded. Variable overhead is assigned to core tests on the basis of direct labor hours. The following events occurred during March:
I. 8,600 pounds of sand were purchased at a cost of $7,310.
II. 7,200 pounds of sand were used for core tests.
III. 840 actual direct labor hours were worked at a cost of $8,610.
IV. Actual variable overhead incurred was $3,200.
6. The materials price variance for March is:
a. $860 unfavorable. c. $281 unfavorable.
b. $860 favorable. d. $281 favorable.
7. The material quantity variance for March is:
a. $ 900 favorable. c. $1,950 unfavorable.
b. $1,950 favorable. d. $900 unfavorable.
8. The labor rate variance for March is:
a. $4,578 unfavorable. c. $4,578 favorable.
b. $1,470 unfavorable. d. $1,470 favorable.
9. The labor efficiency variance for March is:
a. $480 favorable. c. $192 favorable.
b. $480 unfavorable. d. $192 unfavorable.
10. The variable overhead efficiency variance for March is:
a. $320 unfavorable. c. $360 unfavorable.
b. $320 favorable. d. $360 favorable.
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