Question
On December 1, 2016, the company began manufacturing a new widget splitter known as the Widgetron. The company uses a standard costing system to account
On December 1, 2016, the company began manufacturing a new widget splitter known as the Widgetron. The company uses a standard costing system to account for manufacturing costs. The standard cost for one Widgetron is as follows:
Direct Materials | 3lbs at $5 per lb | $15.00 |
Direct Labor | 1/2 hour at $20 per hour | $10.00 |
Manufacturing Overhead | 75% of Direct Labor Cost | $7.50 |
$32.50 |
The following data is available from the company's general ledger records for the month of December:
Debit | Credit | |
Revenues | $125,000 | |
Accounts Payable (for December purchases of direct materials) | $68,250 | |
Direct Materials Price Variance | $3,250 | |
Direct Materials Usage Variance | $2,500 | |
Direct Labor Rate Variance | $1,900 | |
Direct Labor Efficiency Variance | $2,000 |
Actual production during the month was 4,000 units and actual sales were 2,500 units. The amount shown for direct materials price variance applies to materials purchased in December. There was no beginning inventory of materials on December 1, 2016.
Compute each of the following for the month of December:
1) Standard direct labor hours allowed for actual output produced
2) Actual direct labor hours worked
3) Actual direct labor wage rate
4) Standard quantity of direct materials allowed (in pounds)
5) Actual quantity of direct materials used (in pounds)
6) Actual quantity of direct materials purchased (in pounds)
7) Actual direct materials price per pound.
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