Question

The Blazon Manufacturing Company’s costing system has two direct- cost categories: direct materials and direct manufacturing labor. Manufacturing overhead (both variable and fixed) is allocated to products on the basis of standard direct manufacturing labor- hours ( DLH). At the beginning of 2013, Blazon adopted the following standards for its manufacturing costs:


The denominator level for total manufacturing overhead per month in 2013 is 39,000 direct manufacturing labor- hours. Blazon’s flexible budget for January 2013 was based on this denominator level. The records for January indicated the following:
Direct materials purchased............... 37,000 lb. at $ 4.90 per lb.
Direct materials used 34,000 lb.
Direct manufacturing labor .......... 31,600 hours at $ 14.10 per hour
Total actual manufacturing overhead (variable and fixed) .. $ 650,000
Actual production................... 8,400 output units

Required
1. Prepare a schedule of total standard manufacturing costs for the 8,400 output units in January 2013.
2. For the month of January 2013, compute the following variances, indicating whether each is favorable (F) or unfavorable (U):
a. Direct materials price variance, based on purchases
b. Direct materials efficiency variance
c. Direct manufacturing labor price variance
d. Direct manufacturing labor efficiency variance
e. Total manufacturing overhead spending variance
f. Variable manufacturing overhead efficiency variance
g. Production- volumevariance


$1.99
Sales4
Views257
Comments0
  • CreatedJanuary 15, 2015
  • Files Included
Post your question
5000