ezto.mheducati KER 43CS5674 6.75 6-34 600 Watt 4-0hm Car Audio Component Speakers Homework Cha Aaha Inc. produces premium protective automotive covers. The direct materials and direct labour standards for one car cover are as follows: Cost 8.0 metres of cloth $10 per metre $80.00 $18 per hour7 $7per hour $3 or Hours or Rate Direct materials Direct labour Variable overhead 0 hours 0 hours Budgeted fixed overhead cost is $19,100, and the normal production volume is 2,885 car covers. Overhead is applied on the basis of direct labour-hours. In September, the following activity was recorded: 21,600 metres of cloth were purchased at a cost of $9.50 per metre All of the purchased material was used to produce 2,700 car covers 530 direct labour-hours were recorded at a total labour cost of $9,540. Actual variable overhead cost was $4,500, and fixed overhead cost was $18,550. Required: 1. Compute all direct materials variances for September. (Indicate the effect of each variance by selecting "F" for favourable, "U" for unfavourable, and "None" for no effect (i.e, zero variance).) Direct materials price variance Direct materials quantity variance Total direct material cost variance 2. Compute all direct labour cost variances for September. (Indicate the effect of each variance by selecting "F" for favourable, "U" for unfavourable, and "None" for no effect (i.e., zero variance).) Direct labour rate variance Direct labour efficiency variance Total direct labour cost variance ezto.mheduca Homework Ch ER 43CSS674 6.75 6-3/4" 600 Watt 4-Ohm Car Audio Component Speakers.. 3. Calculate the total under- or overapplied overhead. Show all the variances calculated and indicate if each variance is favourable or unfavourable. (Indicate the offect of each variance by selecting "F for favourable, "U" for unfavourable, and "None" for no offect (Lo., zero variance). Do not round intermediate calculations and round "Fixed overhead volume variance and total varlance" to 2 decimal places.) Variable overhead rate variance Variable overhead efficiency vanance Variable overhead total variance Fixed overhead budget variance Fixed overhead volume variance Fixed overhead total variance 4. Suppose the standard price per metre for cloth increases by $1. The quantity variance is unaffected but the price variance will become more favourable than before, all else equal." True or false? True False 5. When the productivity in the use of direct materials improves, where will the impact be first measured? Select from the three choices below In the actual cost of direct materials used In the standard cost of direct materials used. in the cost of the direct materials reported on the flexible budget References eBook & Resources Worksheet
