Part of your company's accounting database was destroyed during a ransomware attack. You have been able togather the following data from your files. Reconstruct the remaining information using the available data. All of theraw material purchased during the period was used in production.Note: Indicate the effect of each variance by selecting "Favorable" or "Unfavorable". Select "None" and enter"O" for no effect (i.e., zero variance). Round "Standard Quantity per Unit of Output" to 2 decimal places.Direct LaborDirect MaterialbokStandard price or rate per unit of inputper hour$7.00 per poundStandard quantity per unit of outputhours per unitpounds per unitActual quantity used per unit of output1.80 hourspounds per unitintActual price or rate per unit of input$11.00 per hour$6.00 per poundrencesActual outputDirect-material price varianceDirect-material quantity variance5,000 units5,000 units$34,000 F$14,000 UTotal direct-material variance$20,000 FDirect-labor rate variance$9,000 UDirect-labor efficiency variance$10,000 FTotal direct-labor variance$1,000 F

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Description: Part of your company's accounting database was destroyed during a ransomware attack. You have been able togather the following data from your files. Reconstruct the remaining information using the available data. All of theraw material purchased dur

Lets understand the basics.The variance is calculated as difference between actual data and standard…

Business

Accounting

Part of your company's accounting database was destroyed during a ransomware attack. You have been able to gather the following data from your files. Reconstruct the remaining information using the available data. All of the raw material purchased during the period was used in production. Note: Indicate the effect of each variance by selecting "Favorable" or "Unfavorable". Select "None" and enter "O" for no effect (i.e., zero variance). Round "Standard Quantity per Unit of Output" to 2 decimal places. Direct Labor Direct Material Standard price or rate per unit of input per hour $ 7.00 per pound Standard quantity per unit of output hours per unit pounds per unit Actual quantity used per unit of output 1.80 hours pounds per unit Actual price or rate per unit of input $ 11.00 per hour $ 6.00 per pound Actual output Direct-material price variance Direct-material quantity variance 5,000 units 5,000 units $ 34.000 F $ 14,000 U 20.000 E

Part of your company's accounting database was destroyed during a ransomware attack. You have been able to gather the following data from your files. Reconstruct the remaining information using the available data. All of the raw material purchased during the period was used in production. Note: Indicate the effect of each variance by selecting "Favorable" or "Unfavorable". Select "None" and enter "O" for no effect (i.e., zero variance). Round "Standard Quantity per Unit of Output" to 2 decimal places. Direct Labor Direct Material Standard price or rate per unit of input per hour $ 7.00 per pound Standard quantity per unit of output hours per unit pounds per unit Actual quantity used per unit of output 1.80 hours pounds per unit Actual price or rate per unit of input $ 11.00 per hour $ 6.00 per pound Actual output Direct-material price variance Direct-material quantity variance 5,000 units 5,000 units $ 34.000 F $ 14,000 U 20.000 E

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

Chapter24: Material And Labor Variances (primevar)

Section: Chapter Questions

Problem 5R: Close the PRIMEVAR4 file and open PRIMEVAR3. Click the Chart sheet tab. On the screen is a graphical...

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Part of your company's accounting database was destroyed during a ransomware attack. You have been able to gather the following data from your files. Reconstruct the remaining information using the available data. All of the raw material purchased during the period was used in production. Note: Indicate the effect of each variance by selecting "Favorable" or "Unfavorable". Select "None" and enter "0" for no effect (i.e., zero variance). Round "Standard Quantity per Unit of Output" to 2 decimal places. Direct Labor Direct Material Standard price or rate per unit of input Standard quantity per unit of output Actual quantity used per unit of output $ 20.00 per hour $ 12.00 per pound 2.68 hours per unit pounds per unit 2.50 hours 4.83 pounds per unit Actual price or rate per unit of input $ 21.00 per hour $ 11.00 per pound Actual output 10,000 units 10,000 units Direct-material price variance $ 52,500 F Direct-material quantity variance $ (18,000) U Total direct-material variance $ 34,500…
By comparing the actual findings with the standards and adopting new standards to avoid or reduce deviations, standard cost variance analysis makes it simple for management to evaluate performance against the benchmark. Focusing on the efficiency of the standard cost system and applying any modifications and updates promptly can help to minimize these effects and produce more accurate results when compared to actual data. Do you believe that the standard cost system can help erase these effects completely?
What characteristics of the variance pattern shown in the report should draw the controller’s attention, regardless of the usual investigation rule? Which of the following is the best reason to also follow up on favorable variances? Bias in investigation targets and subsequent reports is reduced. Favorable variances occur more often as activity levels rise. Production efficiencies may be able to be replicated elsewhere in the organization.
Managers who properly apply the concept called “management by exception” will: * Investigate only favorable variances. Investigate only unfavorable variances. Investigate only variances of a certain size or scope. Always investigate unfavorable and favorable variances regardless of size.
Analyze the variances that you computed in requirements 1 and 2. Was the new service a success from an overall cost-control perspective? Briefly discuss. What seems to have happened that would give rise to customer complaints?
Gauging the Favorableness of Variances When variances occur, they are described as being either favorable or unfavorable. When actual activity consumes more time or money than initially planned, an unfavorable variance exists. However, when actual activity consumes less time or money than initially planned, a favorable variance exists. Note that the terms favorable and unfavorable are used, rather than saying that a variance is good or bad, because until the cause of a variance is discovered, it is not clear whether a variance is either good or bad. Note: Use the minus sign to indicate negative values (when the budgeted amount is greater than the actual). If a company calculates that the actual cost for the actual hours worked by employees was $4,300,000, and the amount budgeted for those hours actually worked was $4,800,000, the actual cost for hours worked less the budgeted cost for hours worked is $ 500,000 x. This tells you that the actual cost at actual hours worked is less than…
Gauging the Favorableness of Variances When variances occur, they are described as being either favorable or unfavorable. When actual activity consumes more time or money than initially planned, an unfavorable variance exists. However, when actual activity consumes less time or money than initially planned, a favorable variance exists. Note that the terms favorable and unfavorable are used, rather than saying that a variance is good or bad, because until the cause of a variance is discovered, it is not clear whether a variance is either good or bad. Note: Use the minus sign to indicate negative values (when the budgeted amount is greater than the actual). If a company calculates that the actual cost for materials used was $4,800,000, and the amount budgeted for those materials was $3,400,000, the actual cost for materials used less the budgeted cost for materials used is $ This tells you that the actual cost at actual materials used is greater than -v the budgeted cost at actual hours…
Gauging the Favorableness of Variances When variances occur, they are described as being either favorable or unfavorable. When actual activity consumes more time or money than initially planned, an unfavorable variance exists. However, when actual activity consumes less time or money than initially planned, a favorable variance exists. Note that the terms favorable and unfavorable are used, rather than saying that a variance is good or bad, because until the cause of a variance is discovered, it is not clear whether a variance is either good or bad. Note: Use the minus sign to indicate negative values (when the budgeted amount is greater than the actual). If a company calculates that the actual cost for the actual hours worked by employees was $4,300,000, and the amount budgeted for those hours actually worked was $4,800,000, the actual cost for hours worked less the budgeted cost for hours worked is $ This tells you that the actual cost at actual hours worked is less than - v the…
Close the PRIMEVAR4 file and open PRIMEVAR3. Click the Chart sheet tab. On the screen is a graphical representation of the variances computed in requirement 3. Review the chart and answer the following questions: a. Which variances does each bar represent? A __________ B __________ C __________ D __________ b. Which of the variances shown would be of most concern to management for immediate attention? (Consider groups of variances and materiality also.) Explain. When the assignment is complete, close the file without saving it again. Worksheet. McGrade Industries also has the following information regarding overhead for October: actual overhead 375,000, standard variable overhead of 3 per direct labor hour, and standard fixed overhead of 5 per direct labor hour (based on 47,000 hours budgeted). Modify the PRIMEVAR3 worksheet to compute all appropriate overhead variances. Preview the printout to make sure that the worksheet will print neatly on one page, and then print the worksheet. Save the completed file as PRIMEVART. Hint: Insert several new rows in the Data Section and in the Answer Section. Chart. Using the PRIMEVAR3 file, prepare a 3-D stacked bar chart to compare total standard cost per unit with actual cost per unit. Complete the Chart Tickler Data Table and use it as a basis for preparing the chart. You do not need to use cell references when completing the table. Enter all appropriate titles, legends, and formats. Enter your name somewhere on the chart. Save the file again as PRIMEVAR3. Print the chart.
In a manufacturing process the assembly line speed (feet per minute) was thought to affect the number of defective parts found during the inspection process. To test this theory, managers devised a situation in which the same batch of parts was inspected visually at a variety of line speeds. They collected the following data: Develop a scatter chart with line speed as the independent variable. What does the scatter chart indicate about the relationship between line speed and the number of defective parts found? Use the data to develop an estimated regression equation that could be used to predict the number of defective parts found, given the line speed. What is the estimated regression model? Test whether each of the regression parameters β0 and β1 is equal to zero at a 0.01 level of significance. What are the correct interpretations of the estimated regression parameters? Are these interpretations reasonable? How much of the variation in the number of defective parts found for the sample data does the model you estimated in part (b) explain?
Should both favorable and unfavorable variances be investigated, or only the unfavorable ones? Explain your response. What if a company found that they had a favorable price variance and an unfavorable quantity variance for direct materials. What might be the cause(s) of this pattern of variances?
Performance Eval Variances: Refer to the pictures. One has the information and the second has the template. Thank you!