Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Direct Materials, Direct Labor, and Factory Overhead Cost Variance Analysis Mackinaw Inc. processes a base chemical into plastic. Standard costs and actual costs for direct

Direct Materials, Direct Labor, and Factory Overhead Cost Variance Analysis

Mackinaw Inc. processes a base chemical into plastic. Standard costs and actual costs for direct materials, direct labor, and factory overhead incurred for the manufacture of 74,000 units of product were as follows:

Standard Costs Actual Costs
Direct materials 236,800 lbs. at $5.10 234,400 lbs. at $4.90
Direct labor 18,500 hrs. at $18.10 18,930 hrs. at $18.50
Factory overhead Rates per direct labor hr.,
based on 100% of normal
capacity of 19,310 direct
labor hrs.:
Variable cost, $4.70 $86,080 variable cost
Fixed cost, $7.40 $142,894 fixed cost

Each unit requires 0.25 hour of direct labor.

Required:

Determine the direct materials price variance, direct materials quantity variance, and total direct materials cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Direct Materials Price Variance $fill in the blank 1

FavorableUnfavorable

Direct Materials Quantity Variance $fill in the blank 3

FavorableUnfavorable

Total Direct Materials Cost Variance $fill in the blank 5

FavorableUnfavorable

Determine the direct labor rate variance, direct labor time variance, and total direct labor cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Direct Labor Rate Variance $fill in the blank 7

FavorableUnfavorable

Direct Labor Time Variance $fill in the blank 9

FavorableUnfavorable

Total Direct Labor Cost Variance $fill in the blank 11

FavorableUnfavorable

Determine the variable factory overhead controllable variance, fixed factory overhead volume variance, and total factory overhead cost variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Variable factory overhead controllable variance $fill in the blank 13

FavorableUnfavorable

Fixed factory overhead volume variance $fill in the blank 15

FavorableUnfavorable

Total factory overhead cost variance $fill in the blank 17

FavorableUnfavorable

.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

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

Costing

Authors: Terry Lucey

6th Edition

0826455107, 9780826455109

More Books

Students also viewed these Accounting questions