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How was the standard Quantity computed to get 34,500? (I bolded the value below) I understand everything else, but the standard quantity is confusing me.
How was the standard Quantity computed to get 34,500? (I bolded the value below) I understand everything else, but the standard quantity is confusing me.
Part 6: Variances | ||||||||||
Pete Sarino's Inc. standard cost card per unit is as follows: | ||||||||||
Direct materials | .5 pounds at $5.24 per pound | 2.62 | ||||||||
Direct labor | .1 hours at $10.50 per hour | 1.05 | ||||||||
Variable overhead | .1 hours at $1.95 per hour | 0.20 | ||||||||
Total standard cost per unit | 3.87 | |||||||||
The planning budget for the month of January was prepared based on selling 64,000 units. However, the company actually produced and sold 69,000 units and incurred the following costs: | ||||||||||
Produced 32,485 pounds of raw materials at a cost of $5.41 per pound. | ||||||||||
Laborers worked 6,831 hours at a rate of $10.85 per hour. | ||||||||||
Total variable manufacturing overhead for the month was $14,823. | ||||||||||
Compute the materials price variance, materials quantity variance, and total materials spending variance for January. Don't forget to indicate whether each is favorable or unfavorable. | ||||||||||
Actual Quantity x | Actual Price | Actual Quantity x | Standard Price | Standard Quantity x | Standard Price | |||||
32,485.00 | $5.41 | 32,485.00 | $5.24 | 34,500.00 ? | $5.24 | |||||
$175,743.85 | $170,221.40 | $180,780.00 | ||||||||
$5,522.45 | $10,558.60 | |||||||||
Unfavorable | Favorable | |||||||||
Price Variance | Quantity Variance | |||||||||
$5,036.15 | ||||||||||
Favorable | ||||||||||
Spending Variance |
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