Problem 10-13 Basic Varlance Analysis; the Impact of Variances on Unit Costs [LO10-1, L010-2, LO10-3) Koontz Company manufactures a number of products. The standards relating to one of these products are shown below, along with actual cost data for May. Standard Cost per Unit Actual cost per $6.84 14.70 14.85 Direct materials: Standard: 1.90 feet at $3.6e per foot Actual: 1.85 feet at $4.ee per foot Direct labor: Standard: 1.05 hours at $14.00 per hour Actual: 1.10 hours at $13.5e per hour Variable overhead: Standard: 1.05 hours at $7.89 per hour Actual: 1.10 hours at 56.60 per hour Total cost per unit Excess of actual cost over standard cost per unit 7.35 $28.89 HS 29.51 $8.52 The production superintendent was pleased when he saw this report and commented: "This $0.62 excess cost is well within the 4 percent limit management has set for acceptable variances. It's obvious that there's not much to worry about with this product Actual production for the month was 16.500 units. Variable overhead cost is assigned to products on the basis of direct labor-hours. There were no beginning or ending Inventories of materials Required: 1. Compute the following variances for May a. Materials price and cuantity variances b. Labor rate and efficiency variances c. Variable overead rate and efficiency variances 2 how much of the 0.02 excess unit cost is traceable to each of the variances computed in above 3. How much of the 50.62 excess unit cost is traceable to apparent inefficient use of laborum managerial anatomy! M#20 a. Materials price and quantity variances b. Labor rate and efficiency variances c Variable overhead rate and efficiency variances. 2. How much of the 50.62 excess unit cost is traceable to each of the variances computed in (above. 3. How much of the $0.62 excess unit cost is traceable to apparent inefficient use of labor time? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 1a. Compute the following variances for May, materials price and quantity variances. 1b. Compute the following variances for May, labor rate and efficiency variances. 16. Compute the following variances for May, variable overhead rate and efficiency variances. Indicate the effect of each variance by selecting "Ffor favorable, "U" for unfavorable, and "None for no effect (e zero variance). Input al amounts as positive values.) 1a. Matenals price variance Matena's quantity variance Labor rate variance ency van ande 1. Variable overhead rate variance Variable overhead efficiency variance Required 2 Idle and ethiciency variances 2. How much of the $0.62 excess unit cost is traceable to each of the variances computed in above 3. How much of the $0.62 excess unit cost is traceable to apparent inefficient use of labor time? Complete this question by entering your answers in the tabs below Required 1 Required 2 Required 3 How much of the $0.62 excess unit cost is traceable to each of the variances computed in (1) above. (Indicate the effect of each variance by selecting for favorable, Tu for unfavorable, and "None" for no effect (i.eu zero variance). Input all amounts as positive values. Round your answers to 2 decimal places.) Materials: Price variance Quantity variance Labor Rate variance E ency variance Variable overhead Rate variance E ncy variance Excess of actual over standard cost per un Seque Recured 3 >
