Highland Company produces a lightweight backpack that is popular with college students Standard variable costs relating to a single backpack are given below Standard Quantity or Hours Standard Price or Rate Standard Cost Direct materials $ 8 00 per yard $ Direct labor Variable manufacturing overhead $ 2 per direct labor hour Total standard cost per unit $ Overhead is applied to production on the basis of direct labor hours During March, 600 backpacks were manufactured and sold Selected information relating to the months production is given below Materials Used Direct Labor Variable Manufacturing Overhead Total standard cost allowed $ 15,360 $ 9,000 $ 1,800 Actual costs incurred $ 13,965 $ 2,985 Materials price variance Materials quantity variance $ 600 U Labor rate variance Labor efficiency variance Variable overhead rate variance Variable overhead efficiency variance For the month's production The following additional information is available for Marchs production Actual direct labor hours 900 Difference between standard and actual cost per backpack produced during March $ 0 20 F Required Hint It may be helpful to complete a general model diagram for direct materials, direct labor, and variable manufacturing overhead before attempting to answer any of the requirements 1 What is the standard cost of a single backpack ANSWER $43 60 2 What was the actual cost per backpack produced during March ANSWER $43 40 3 How many yards of material are required at standard per backpack ANSWER 3 2 4 What was the materials price variance for March if there were no beginning or ending inventories of materials ANSWER 1995 F 5 What is the standard direct labor rate per hour ANSWER $10 00 6 What was the labor rate variance for March The labor efficiency variance 7 What was the variable overhead rate variance for March The variable overhead efficiency variance 8 Prepare a standard cost card for one backpack (Round answers to 2 decimal places)

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Sep 06, 2024

Highland Company produces a lightweight backpack that is popular with college students. Standard variable costs relating to a single backpack are given below: Standard Quantity

Highland Company produces a lightweight backpack that is popular with college students. Standard variable costs relating to a single backpack are given below:

	Standard Quantity or Hours	Standard Price or Rate			Standard Cost
Direct materials	?	$	8.00	per yard	$	?
Direct labor	?		?			?
Variable manufacturing overhead	?	$	2	per direct labor-hour		?
Total standard cost per unit					$	?

Overhead is applied to production on the basis of direct labor-hours. During March, 600 backpacks were manufactured and sold. Selected information relating to the months production is given below:

	Materials Used			Direct Labor		Variable Manufacturing Overhead
Total standard cost allowed*	$	15,360		$	9,000	$	1,800
Actual costs incurred	$	13,965			?	$	2,985
Materials price variance		?
Materials quantity variance	$	600	U
Labor rate variance					?
Labor efficiency variance					?
Variable overhead rate variance							?
Variable overhead efficiency variance							?

*For the month's production.

The following additional information is available for Marchs production:


Actual direct labor-hours		900
Difference between standard and actual cost per backpack produced during March	$	0.20	F

Required:

Hint: It may be helpful to complete a general model diagram for direct materials, direct labor, and variable manufacturing overhead before attempting to answer any of the requirements.

1. What is the standard cost of a single backpack? ANSWER: $43.60

2. What was the actual cost per backpack produced during March? ANSWER: $43.40

3. How many yards of material are required at standard per backpack? ANSWER: 3.2

4. What was the materials price variance for March if there were no beginning or ending inventories of materials? ANSWER: 1995 F

5. What is the standard direct labor rate per hour? ANSWER: $10.00

6. What was the labor rate variance for March? The labor efficiency variance?

7. What was the variable overhead rate variance for March? The variable overhead efficiency variance?

8. Prepare a standard cost card for one backpack. (Round answers to 2 decimal places)