Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Mickley Corporation produces two products, Alpha6s and Zeta7s, which pass through two operations, Sintering and Finishing. Each of the products uses two raw materialsX442 and

Mickley Corporation produces two products, Alpha6s and Zeta7s, which pass through two operations, Sintering and Finishing. Each of the products uses two raw materialsX442 and Y661. The company uses a standard cost system, with the following standards for each product (on a per unit basis):

Product Raw Material Standard Labor Time
X442 Y661 Sintering Finishing
Alpha6 1.5 kilos 2.2 liters 0.40 hours 0.80 hours
Zeta7 3.5 kilos 4.4 liters 0.30 hours 0.90 hours

Information relating to materials purchased and materials used in production during May follows:

Material Purchases Purchase Cost Standard Price Used in Production
X442 14,100 kilos $ 53,580 $ 3.60 per kilo 8,600 kilos
Y661 15,100 liters $ 21,140 $ 1.50 per liter 13,100 liters

The following additional information is available:

  1. The company recognizes price variances when materials are purchased.
  2. The standard labor rate is $18.00 per hour in Sintering and $18.00 per hour in Finishing.

  3. During May, 1,250 direct labor-hours were worked in Sintering at a total labor cost of $28,250, and 2,860 direct labor-hours were worked in Finishing at a total labor cost of $57,200.

  4. Production during May was 1,600 Alpha6s and 1,800 Zeta7s.

Required:

1. Complete the standard cost card for each product, showing the standard cost of direct materials and direct labor.

Complete the standard cost card for each product, showing the standard cost of direct materials and direct labor. (Round your answers to 2 decimal places.)

Standard Quantity or Hours Standard Price or Rate Standard Cost
Alpha6:
Direct materialsX442 kilos per kilo
Direct materialsY661 liters per liter
Direct laborSintering hours per hour
Direct laborFinishing hours per hour
Total
Zeta7:
Direct materialsX442 kilos per kilo
Direct materialsY661 liters per liter
Direct laborSintering hours per hour
Direct laborFinishing hours per hour
Total

2. Compute the materials price and quantity variances for each material.

Compute the materials price and quantity variances for each material. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)

Direct Materials VariancesMaterial X442:
Materials price variance
Materials quantity variance
Direct Materials VariancesMaterial Y661:
Materials price variance
Materials quantity variance

3. Compute the labor rate and efficiency variances for each operation.

Direct Labor VariancesSintering:
Labor rate variance
Labor efficiency variance
Direct Labor VariancesFinishing:
Labor rate variance
Labor efficiency variance

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

Managerial Accounting

Authors: James Jiambalvo

5th edition

1118078764, 978-1118078761

More Books

Students also viewed these Accounting questions