Question
Determining Unit Costs, Variance Analysis, and Interpretation Big Dog Company, a manufacturer of dog food, produces its product in 1,000-bag batches. The standard cost of
Determining Unit Costs, Variance Analysis, and Interpretation Big Dog Company, a manufacturer of dog food, produces its product in 1,000-bag batches. The standard cost of each batch consists of 8,000 pounds of direct materials at $0.40 per pound, 48 direct labor hours at $8.75 per hour, and variable overhead cost (based on machine hours) at the rate of $10 per hour with 16 machine hours per batch. The following variable costs were incurred for the last 1,000-bag batch produced:
Direct materials | 8,300 pounds costing $ 3,154 were purchased and used |
Direct labor | 45 hours costing $ 450 |
Variable overhead | $ 225 |
Machine hours used | 18 hours |
(a) Determine the actual and standard variable costs per bag of dog food produced, separated into direct materials, direct labor, and variable overhead.
Round your answers to 3 decimal places.
Actual Cost | Standard Cost | |
Direct materials | $Answer | $Answer |
Direct labor | Answer | Answer |
Variable overhead | Answer | Answer |
Total variable costs per bag | $Answer | $Answer |
(b) For the last 1,000-bag batch, determine the standard cost variances for direct materials, direct labor, and variable overhead.
Round your answers two decimal places.
Materials price variance | $Answer Answer |
Materials quantity variance | $Answer Answer |
Labor rate variance | $Answer Answer |
Labor efficiency variance | $Answer Answer |
Variable overhead spending variance | $Answer Answer |
Variable overhead efficiency variance | $Answer Answer |
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