ACC 202 Ch 10 HW and Quiz- BURGESS

the standard rate exceeds the actual rate

A favorable labor rate variance indicates that: the acual rate exceeds the standard rate standard hours exceed actual hours actual hours exceed standard hours the standard rate exceeds the actual rate

b)both the activity variances and the spending variances

A flexible budget performance report for variable manufacturing costs shows _______. a) only the activity variances b)both the activity variances and the spending variances c) both the revenue variances and the spending variances. d) both the quantity variances and the price variances.

Materials Price Variance = 3,000 F Materials Q variance= 4,000 U Labor Rate Variance= 1,425 U Labor Efficiency variance= 900 F Material Price= (AQ *AP) - (AQ *SP) =>(20,000*$2.35) - (20,000 *$2.50) Materials Quantity variance= (AQ*SP) - (SQ*SP)=>(20,000*$2.50) -(18,400*$2.50) Labor rate variance= (AH*AR) - (AH*SR)=> ($750*$19.90) - (750*$18) Labor efficiency variance= (AH*SR) - (SH*SR) =>(750*$18)-(800*$18)qui

AQ = actual quantity = 20,000 pounds AP = actual price = $2.35 per pound. SQ = standard quantity = 4,000 units * 4.6 pounds per unit =>18,400 pounds SP = standard price = $2.50 per unit AH = Actual hours =>750 hours. AR = Actual rate = total actual cost / actual hours =$14,925 / 750 =>$19.90. SH= Standard hours = 0.2 hours per unit * 4,000 units =>800 hours. SR = standard rate = $18 per hour 1. Compute the materials price and quantity variances for the month. 2. Compute the labor rate and efficiency variances for the month.

$220 F AH(AR-SR)

Actual hours of input at actual rate (AH*AR)= 2,200*1.9 Actual hours of input at Standard Rate (AH*SR)= 2,200*2 Standard hours of Input at Standard Rate (SH*SR)= 2,000*2 What is the labor rate variance? $180 F $220 F $220 U $400 U

180 U (AH×AR)−(SH×SR)

Actual hours of input at actual rate (AH*AR)= 2,200*1.9 Actual hours of input at Standard Rate (AH*SR)= 2,200*2 Standard hours of Input at Standard Rate (SH*SR)= 2,000*2 What is the spending variance? $180 F $180 U $4,000 F $4,000 U

will be unfavorable

Assume that direct labor-hours are used as the overhead allocation base. If the direct labor efficiency variance is unfavorable, the variable overhead efficiency variance ________. will be favorable. will be unfavorable. cannot be determined without additional information. will be equal to zero.

$2,000 U

If the Spending Variance for Materials is $700 Unfavorable, and the Materials Price Variance is $1,300 Favorable, then the Materials Quantity Variance must be: $2,000 F $600 U $600 F $2,000 U

$18,000 Favorable

Magno Cereal Corporation uses a standard cost system for its "crunchy pickle" cereal. The materials standard for each batch of cereal produced is 1.4 pounds of pickles at a standard cost of $3.00 per pound. During the month of August, Magno purchased 78,000 pounds of pickles at a total cost of $253,500. Magno used all of these pickles to produce 60,000 batches of cereal. What is Magno's materials quantity variance for August? $19,500 Unfavorable $1,500 Unfavorable $18,000 Favorable $54,000 Unfavorable

a) received from suppliers and transported to raw materials inventory.

Most companies compute the materials price variance when raw materials are _______. a) received from suppliers and transported to raw materials inventory. b) withdrawn from raw materials inventory and used in production. c) ordered from suppliers. d) moved from work in process inventory to finished goods inventory.

Only Material Quantity Variance

Poorly trained workers could have an unfavorable effect on which of the following variances? Only Labor Rate Variance Labor Rate Variance and Material Quantity Variance Only Material Quantity Variance Neither Labor Rate nor Material Quantity Variance

$600 U

Standard rate per direct labor-hour $2 Standard direct labor-hours for each unit produced 3 Units manufactured 1,000 Actual direct labor-hours worked during the month 3,300 Total actual variable manufacturing overhead $6,600 Assume that direct labor-hours is used as the overhead allocation base. What is the variable overhead efficiency variance? $300 F $300 U $600 F $600 U

$9,955 F

The following labor standards have been established for a particular product: Standard labor-hours per unit of output 8.7 hoursStandard labor rate $ 18.10 per hour The following data pertain to operations concerning the product for the last month: Actual hours worked 3,800 hours Actual total labor cost $ 67,640 Actual output 500 units What is the labor efficiency variance for the month? $11,095 F $9,790 F $9,955 F $11,095 U

$2,025 U

The following materials standards have been established for a particular product: Standard quantity per unit of output 5.3 metersStandard price $ 17.20 per meter The following data pertain to operations concerning the product for the last month: Actual materials purchased 8,100 metersActual cost of materials purchased $ 141,345Actual materials used in production 7,600 metersActual output 1,400 units What is the materials price variance for the month? $3,141 U $8,600 U $2,025 F $2,025 U

b)the direct labor-hours that should have been used to complete the actual output for the period.

The standard hours allowed is ________. a) the direct labor-hours that should have been used to complete the planned output for the period. b)the direct labor-hours that should have been used to complete the actual output for the period. c) computed by multiplying the standard labor-hours allowed per unit by the planned output for the period. d)computed by multiplying the actual labor-hours per unit by the planned output for the period.

c) the amount of an input that should have been used to complete the actual output for the period.

The standard quantity allowed is _______. a) the amount of an input that should have been used to complete the planned output for the period. b) the actual amount of input that was used to complete the planned output for the period. c) the amount of an input that should have been used to complete the actual output for the period. d) the actual amount of input that was used to complete the actual output for the period.

variable portion of the predetermined overhead rate

When computing variable manufacturing overhead variances, the standard rate represents the ________. predetermined overhead rate. variable portion of the predetermined overhead rate .standard hourly pay rate for direct laborers. the amount of hours allowed for the actual output.

D) both A and C are correct

Which of the following could explain an unfavorable Materials Quantity Variance? A) poorly trained production workers C)use of poor quality direct materials D) both A and C are correct B) paying more for the direct materials than planned (budgeted)

the purchasing manager

Who generally would be responsible for explaining why a Material Price Variance occurred? the purchasing manager the accounting manager the production or operations manager the human relations manager

A) 5,900 hours

The Fime Corporation uses a standard costing system. The following data have been assembled for December: Actual direct labor-hours worked 6,200 hoursStandard direct labor rate $ 7 per hourLabor efficiency variance $ 2,100 Unfavorable A) 5,900 hours B) 6,500 hours C) 6,200 hours D) 6,000 hours

c) amount of direct materials that should be used for each unit of finished product including an allowance for normal inefficiencies, such as scrap and spoilage.

The standard quantity per unit defines the ________. a) price that should be paid for each unit of direct materials. b) total cost of direct materials that should be used for each unit of finished product. c) amount of direct materials that should be used for each unit of finished product including an allowance for normal inefficiencies, such as scrap and spoilage. d) amount of direct labor-hours that should be used to produce one unit of finished goods.

$1,188 Unfavorable

Zanny Electronics Corporation uses a standard cost system for the production of its water ski radios. The direct labor standard for each radio is 0.9 hours. The standard direct labor cost per hour is $7.20. During the month of August, Zanny's water ski radio production used 6,600 direct labor-hours at a total direct labor cost of $48,708. This resulted in production of 6,900 water ski radios for August. What is Zanny's labor rate variance for August? $1,188 Unfavorable $2,808 Unfavorable $972 Favorable $2,160 Favorable

$2,500 U Price variance = AQ(AP − SP) = 25,000 yards ($2.10 per yard − $2.00 per yard) = $2,500 U Because the actual price is greater than the standard price, the materials price variance is unfavorable

Zeta Corporation is a manufacturer of sports caps, which require soft fabric. The standards for each cap allow 2.00 yards of soft fabric, at a cost of $2.00 per yard. During the month of January, the company purchased and used 25,000 yards of soft fabric at $2.10 per yard, to produce 12,000 caps. What is Zeta Corporation's materials price variance for the month of January? $2,000 F $2,000 U $2,500 F $2,500 U