Standard Cost Actual Cost per Unit 15.30 $ 5.25 Direct materials: Standard: 1.80 feet at $2.80...

Transcribed Image Text:

Standard Cost Actual Cost per Unit 15.30 $ 5.25 Direct materials: Standard: 1.80 feet at $2.80 per foot Actual: 1.75 feet at $3.00 per foot Direct labor: Standard: 0.90 hours at $17.00 per hour Actual: 0.95 hours at $16.40 per hour Variable overhead: Standard: 0.90 hours at $7.40 per hour Actual: 0.95 hours at $7.00 per hour Total cost per unit per Unit $ 5.04 6.66 $ 27.00 Excess of actual cost over standard cost per unit 15.58 6.65 $ 27.48 $ 0.48 The production superintendent was pleased when he saw this report and commented: "This $0.48 excess cost is well within the 5 percent limit management has set for acceptable variances. It's obvious that there's not much to worry about with this product." Actual production for the month was 14,500 units. Variable overhead cost is assigned to products on the basis of direct labor-hours. There were no beginning or ending Inventories of materials. Required: 1. Compute the following variances for May: a. Materials price and quantity variances. b. Labor rate and efficiency variances. c. Variable overhead rate and efficiency variances. 2. How much of the $0.48 excess unit cost is traceable to each of the variances computed in requirement 1. 3. How much of the $0.48 excess unit cost is traceable to apparent inefficient use of labor time? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 How much of the $0.48 excess unit cost is traceable to each of the variances computed in requirement 1. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values. Round your answers to 2 decimal places.) Materials: Price variance Quantity variance Labor: Rate variance Efficiency variance Variable overhead: F 0.00 U 0.57 F 0.85 U 0.28 U Rate variance 0.38 F Efficiency variance 0.37 U 0.01 F Excess of actual over standard cost per unit $ 0.27 U Standard Cost Actual Cost per Unit 15.30 $ 5.25 Direct materials: Standard: 1.80 feet at $2.80 per foot Actual: 1.75 feet at $3.00 per foot Direct labor: Standard: 0.90 hours at $17.00 per hour Actual: 0.95 hours at $16.40 per hour Variable overhead: Standard: 0.90 hours at $7.40 per hour Actual: 0.95 hours at $7.00 per hour Total cost per unit per Unit $ 5.04 6.66 $ 27.00 Excess of actual cost over standard cost per unit 15.58 6.65 $ 27.48 $ 0.48 The production superintendent was pleased when he saw this report and commented: "This $0.48 excess cost is well within the 5 percent limit management has set for acceptable variances. It's obvious that there's not much to worry about with this product." Actual production for the month was 14,500 units. Variable overhead cost is assigned to products on the basis of direct labor-hours. There were no beginning or ending Inventories of materials. Required: 1. Compute the following variances for May: a. Materials price and quantity variances. b. Labor rate and efficiency variances. c. Variable overhead rate and efficiency variances. 2. How much of the $0.48 excess unit cost is traceable to each of the variances computed in requirement 1. 3. How much of the $0.48 excess unit cost is traceable to apparent inefficient use of labor time? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 How much of the $0.48 excess unit cost is traceable to each of the variances computed in requirement 1. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values. Round your answers to 2 decimal places.) Materials: Price variance Quantity variance Labor: Rate variance Efficiency variance Variable overhead: F 0.00 U 0.57 F 0.85 U 0.28 U Rate variance 0.38 F Efficiency variance 0.37 U 0.01 F Excess of actual over standard cost per unit $ 0.27 U