Question
On 1 June 2021, XYZ Company began the manufacture of a new mobile phone known as SuperMobile . The company uses a standard costing system.
On 1 June 2021, XYZ Company began the manufacture of a new mobile phone known as SuperMobile. The company uses a standard costing system. The standard costs for a unit of SuperMobile follow:
Direct materials (3 pounds at $5.00 per pound.) | $15.00 |
Direct manufacturing labor ( hour at $20.00 per hour) | 10.00 |
Manufacturing overhead (75% of direct manufacturing labor costs) | 7.50 |
$32.50 |
The following data were obtained from XYZ Company's records for the month of June:
Debit $ | Credit $ | |
Revenues | 125,000 | |
Account payable control [for June's purchases of direct materials] | 68,250 | |
Direct materials price variance | 3,250 | |
Direct materials efficiency variance | 2,500 | |
Direct manufacturing labor price variance | 1,900 | |
Direct manufacturing labor efficiency variance | 2,000 |
Actual production in June was 4,000 units of SuperMobile, and actual sales in June were 2,500 units. The amount shown earlier for direct materials price variance applies to materials purchased during June. There was no beginning inventory for materials on 1 June 2021.
REQUIRED:
(Please show your workings clearly for the following questions).
- Compute the standard direct manufacturing labor hours allowed for the actual output produced.
- Compute the actual direct manufacturing labor hours worked.
- Compute the standard quantity of direct materials allowed (in pounds).
- Compute the actual quantity of direct materials used (in pounds).
- Compute the actual quantity of direct materials purchased (in pounds).
- Compute the actual direct materials price per pound.
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