Unit VII Lab Assignment

1) the difference between standard and actual cost is

a) considered to be an ideal standard

b) a variance by exception

c) the budgeted cost of one item of product

d) a standard cost variance

2) what are the two most likely reasons an unfavorable total materials variance may exist?

a) inflation caused an increase in the cost to acquire materials of the same quality, and due to this inflation, the company purchased fewer materials than used

b) the company used less materials than it purchased, and the amount paid for the materials was more than the standard price

c) the price paid was more than the standard price, and the quantity budgeted was less than quantity used

d) the price paid was more than the standard price, and the quantity used was less than the quantity budgeted

3) at Cinrich, the standard price for the M640 electrical relay (a component used in the production of a commercial refrigeration unit) is $62. standards call for 2.0 relays per unit of finished product. in july, the company purchased 163 relays for $8,965. the company used 105 relays in the production of 46 refrigeration units (4 relays were damaged in the installation process). calculate the material price variance and the material quantity variance related to the m640 electrical relay. indicate whether the variance are favorable or unfavorable. (round intermediate calculations to 2 decimals places, e.g. 14.37 and final answers to 0 decimal places, e.g. 125 enter all variances as a positive number

material price variance enter a dollar amount select an option - unfavorable / favorable / neither unfavorable nor favorable

material quantity variance enter a dollar amount select an option - unfavorable / neither unfavorable nor favorable / favorable

4) at elkhardt, the standard quantity of labor is 24 hours per refrigeration unit. the standard wage rate is $34. in july the company produced 82 refrigeration units and incurred 2,110 labors hours at a cost of $69,630. caculate the labor rate variance and the labor efficiency variance. indicate whether the variances are favorable or unfavorable. (round intermediate calculations to 2 decimals places, e.g. 14.37 and final answers to 0 decimal places e.g. 125 enter all variances as a positive number

labor rate variance enter rate variance in dollar amount select an option favorable/unfavorable/neither favorable nor unfavorable

labor efficiency variance enter labor efficiency in dollar amount select an option favorable/unfavorable/neither favorable nor unfavorable

5) the standard labor cost in the production of a pair of elkhardt brand athletics shoes is 0.40 hours at $14.00 per hour. during the month of june 25,470 pairs were produced. actual labor costs were $106,080 for 8,160 hours. compute the labor rate and labor efficiency variances for the month of june. (round actual wage rate to 2 decimal place, e.g. 15.25 and final answers to 0 decimal places e.g. 125. enter all variances as a positive number)

labor rate variance enter labor rate variance as dollar amount, select an option unfavorable/ favorable/ neither unfavorable nor favorable

labor efficiency variance enter labor efficiency variance as a dollar amount, select an option unfavorable / favorable / neither unfavorable nor favorable

6) the pear city company uses a standard costing system. during 2021 the company incurred actual overhead of $571,300. the standard rate for applying overhead is $4.11 per unit, and 121,500 units were produced in 2021. one-third of the total overhead variance is attributed to the volume variance, and the remainder is attributed to the controllable overhead variance. prepare the journal entries to record overhead incurred (you should credit "various accounts") and the overhead variances.

1) enter an account title to record actual overhead incurred enter a debit amount enter a credit amount

enter an account title to record actual overhead incurred enter a debit amount enter a credit amount

to record actual overhead incurred

2) enter an account title to record overhead applied enter a debit amount enter a credit amount

enter an account title to record overhead applied enter a debit amount enter a credit amount

to record overhead applied

3) enter an account title to close manufacturing overhead and record overhead variances enter a debit amount

enter a credit amount

enter an account title to close manufacturing overhead and record overhead variances enter a debit amount

enter a credit amount

enter an account title to close manufacturing overhead and record overhead variances enter a debit amount

enter a credit amount

7) elkhardt jewelry produced 1,400 rings during march. the standard cost of each ounce of gold used in a ring is $1,000 per ounce. the standard quantity of material for each ring is a half ounce of gold per ring. the cost of gold purchased and used in march was $759,700 at $1,070 per ounce. determine the material price variance and the material quantity variance for march. indicate whether each variance is favorable or unfavorable ( enter all variances as a positive number)

material price variance enter a dollar amount select an option favorable / unfavorable

material quantity variance enter a dollar amount select an option favorable / unfavorable