Kaneohe Corp uses a standard costing system and manufactures hula doll lamps. Standard costs for its largest
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Question:
Kaneohe Corp uses a standard costing system and manufactures hula doll lamps. Standard costs for its largest selling product, a midsize table lamp, are:
Item
Variable overhead hr @ $hour $
Fixed overhead hr @ $hour
Direct materials kg @ $kg
Direct labour hr @ $hour
Standard cost per unit $
During the last fiscal year ended December
Kaneohe reported the following information in connection with the production of this table lamp:
Actual VOH incurred: $
Actual FOH incurred: $
Production: units
Direct material purchases: kg at $kg
Beginning inventory of direct material: kg carried at standard cost
Total direct labour used: hours, at a cost of $
No ending inventory
The companys factory can produce table lamps a year, but a denominator level was set at units for the year ended December Cost driver is direct labour hours.
Requirement
Using either the formula or the columnar method compute the following variances. Include whether variances are favourable F or unfavourable U
a VOH spending and efficiency variances
b FOH spending variance
c Direct materials price and efficiency variances
d Direct labour rate and efficiency variances and production volume variance
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