Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

[The following information applies to the questions displayed below.) Trico Company set the following standard unit costs for its single product. Direct materials (30 lbs.

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
[The following information applies to the questions displayed below.) Trico Company set the following standard unit costs for its single product. Direct materials (30 lbs. @ $4.40 per Ib.) Direct labor (6 hrs. @ $14 per hr.) Factory overhead-variable (6 hrs. e $8 per hr.) Factory overhead-fixed (6 hrs. e $12 per hr.) $132.00 84.00 48.00 72.00 Total standard cost $336,00 The predetermined overhead rate is based on a planned operating volume of 80% of the productive capacity of 69.000 units per quarter. The following flexible budget information is available. 800 Operating Levels 708 903 48,300 55,200 62,10 289,800 331,200 372,600 Production in units Standard direct labor hours Budgeted overhead Fixed factory overhead Variable factory overhead $3,974,400 $3,974,400 $3,974,400 $2,318,400 $2,649,600 $2,980, BOO During the current quarter, the company operated at 90% of capacity and produced 62,100 units of product; actual direct labor totaled 291,000 hours. Units produced were assigned the following standard costs. Ib.) $ 8,197,200 Direct materials (1,863,000 lbs. e $4.40 per Direct labor (372,600 hrs. $14 per hr.) Factory overhead (372,600 hrs. @ $20 per hr.) Total standard cost 5,216,400 7.452,000 $20,865,600 Actual costs incurred during the current quarter follow. Direct materials (1,466,000 lbs. $7.40 per lb.) Direct labor (291,000 hrs. $12.60 per hr.) Fixed factory overhead costs Variable factory overhead costs Total actual costs $10,848, 400 3,666,600 3,014,600 3,272,200 $20,801, 800 Required: 1. Compute the direct materials cost variance, including its price and quantity variances. AQ = Actual Quantity SQ - Standard Quantity AP = Actual Price SP = Standard Price Actual Cost Standard Cost 2. Compute the direct labor cost variance, including its rate and efficiency variances. AH = Actual Hours SH - Standard Hours AR = Actual Rate SR = Standard Rate Actual Cost Standard Cost 3. Compute the overhead controllable and volume variances. Controllable Variance Actual overhead Budgeted overhead Controllable variance Fixed overhead volume variance Budgeted fixed overhead Fixed overhead cost applied Fixed overhead volume variance (a) Compute the variable overhead spending and efficiency variances. (Round "cost per unit" and "rate per hour" answers to 2 decimal places.) AH - Actual Hours SH - Standard Hours AVR - Actual Variable Rate SVR - Standard Variable Rate Actual Variable OR Cout Flexible Budget Standard Cost (VOH applied) (b) Compute the fixed overhead spending and volume variances. (Round "cost per unit" and "rate per hour" answers to 2 decimal places.) AH = Actual Hours SH - Standard Hours AFR = Actual Fixed Rate SFR = Standard Fixed Rate Actual Fixed OH Cost Budgeted Overhead Standard Cost (FOH applied) (c) Compute the total overhead controllable variance. Overhead Controllable Variance Total overhead controllable 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

More Books

Students also viewed these Accounting questions

Question

Explain in brief the functions and functioning of stock exchanges.

Answered: 1 week ago

Question

The company has fair promotion/advancement policies.

Answered: 1 week ago