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Kropf Inc. has provided the following data concerning one of the products in its standard cost system. Variable manufacturing overhead is applied to products on the basis of direct labor-hours. Inputs. Direct materials. Direct labor Variable manufacturing overhead Actual output Raw materials purchased! Actual cost of raw materials purchased Raw materials used in production Actual direct labor-hours The company has reported the following actual results for the product for September: Actual direct labor cost Actual variable overhead cost Standard Quantity or Hours per Unit of Output 7.60 liters 0.60 hours 0.60 hours a. Materials price variance b. Materials quantity variance c. Labor rate variance d. Labor efficiency variance e. variable overhead spending variance f. Variable overhead efficiency variance. 9,800 units 75,200 liters $564,500 74,500 liters 5,500 hours Standard Price or Rate $ 7.20 per liter $23.70 per hour $ 6.10 per hour $135,302 $ 29,314 Required: a. Compute the materials price variance for September. b. Compute the materials quantity variance for September.. c. Compute the labor rate variance for September. d. Compute the labor efficiency variance for September. e. Compute the variable overhead spending variance for September. f. Compute the, variable overhead efficiency variance for September. (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.)

Kropf Inc. has provided the following data concerning one of the products in its standard cost system. Variable manufacturing overhead is applied to products on the basis of direct labor-hours. Inputs. Direct materials. Direct labor Variable manufacturing overhead Actual output Raw materials purchased! Actual cost of raw materials purchased Raw materials used in production Actual direct labor-hours The company has reported the following actual results for the product for September: Actual direct labor cost Actual variable overhead cost Standard Quantity or Hours per Unit of Output 7.60 liters 0.60 hours 0.60 hours a. Materials price variance b. Materials quantity variance c. Labor rate variance d. Labor efficiency variance e. variable overhead spending variance f. Variable overhead efficiency variance. 9,800 units 75,200 liters $564,500 74,500 liters 5,500 hours Standard Price or Rate $ 7.20 per liter $23.70 per hour $ 6.10 per hour $135,302 $ 29,314 Required: a. Compute the materials price variance for September. b. Compute the materials quantity variance for September.. c. Compute the labor rate variance for September. d. Compute the labor efficiency variance for September. e. Compute the variable overhead spending variance for September. f. Compute the, variable overhead efficiency variance for September. (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.)

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter15: Lean Accounting And Productivity Measurement
Section: Chapter Questions
Problem 18E: Lean manufacturing uses value streams to produce a family of products that require the same...
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Kropf Inc. has provided the following data concerning one of the products in its standard cost system. Variable manufacturing overhead is applied to products on the basis of direct labor-hours. Inputs Direct materials. Direct labor Variable manufacturing overhead Actual output Raw materials purchased Actual cost of raw materials purchased Raw materials used in production Actual direct labor-hours Actual direct labor cost Actual variable overhead cost Standard Quantity or Hours per Unit of Output The company has reported the following actual results for the product for September: Required: a. Compute the materials price variance for September. b. Compute the materials quantity variance for September.. c. Compute the labor rate variance for September. a. Materials price variance b. Materials quantity variance c. Labor rate variance 7.60 liters 0.60 hours 0.60 hours d. Labor efficiency variance e. variable overhead spending variance 1. Variable overhead efficiency variance 9,800 units 75,200 liters $564,500 74,500 liters 5,500 hours Standard Price or Rate. $ 7.20 per liter $23.70 per hour $ 6.10 per hour $135,302 $ 29,314 d. Compute the labor efficiency variance for September. e. Compute the variable overhead spending variance for September. f. Compute the, variable overhead efficiency variance for September. (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.)
Transcribed Image Text:Kropf Inc. has provided the following data concerning one of the products in its standard cost system. Variable manufacturing overhead is applied to products on the basis of direct labor-hours. Inputs Direct materials. Direct labor Variable manufacturing overhead Actual output Raw materials purchased Actual cost of raw materials purchased Raw materials used in production Actual direct labor-hours Actual direct labor cost Actual variable overhead cost Standard Quantity or Hours per Unit of Output The company has reported the following actual results for the product for September: Required: a. Compute the materials price variance for September. b. Compute the materials quantity variance for September.. c. Compute the labor rate variance for September. a. Materials price variance b. Materials quantity variance c. Labor rate variance 7.60 liters 0.60 hours 0.60 hours d. Labor efficiency variance e. variable overhead spending variance 1. Variable overhead efficiency variance 9,800 units 75,200 liters $564,500 74,500 liters 5,500 hours Standard Price or Rate. $ 7.20 per liter $23.70 per hour $ 6.10 per hour $135,302 $ 29,314 d. Compute the labor efficiency variance for September. e. Compute the variable overhead spending variance for September. f. Compute the, variable overhead efficiency variance for September. (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.)
The direct materials and direct labour standards for one bottle of Clean-All spray cleaner are given below: Standard Quantity or Hours. 7.0 millilitres 0.3 hours Standard Price or Rate. Standard Cost $2.17 $3.60 Direct materials. Direct labour $ 0.31 per millilitre $12.00 per hour During the most recent month, the following activity was recorded: a. 23,000 millilitres of material was purchased at a cost of $0.26 per millilitre. b. All of the material was used to produce 3,640 bottles of Clean-All. c. 600 hours of direct labour time was recorded at a total labour cost of $7,200. Assume that instead of producing 3,640 bottles of Clean-All during the month, the company produced only 2,000 bottles, using 19,000 millilitres of material. (The rest of the material purchased remained in raw materials inventory.) Required. Compute the direct materials price and quantity variances for the month. (Indicate the effect of each variance by selecting "F" for favourable, "U" for unfavourable, and "None" for no effect (i.e., zero variance).) Materials price variance Materials quantity variance
Transcribed Image Text:The direct materials and direct labour standards for one bottle of Clean-All spray cleaner are given below: Standard Quantity or Hours. 7.0 millilitres 0.3 hours Standard Price or Rate. Standard Cost $2.17 $3.60 Direct materials. Direct labour $ 0.31 per millilitre $12.00 per hour During the most recent month, the following activity was recorded: a. 23,000 millilitres of material was purchased at a cost of $0.26 per millilitre. b. All of the material was used to produce 3,640 bottles of Clean-All. c. 600 hours of direct labour time was recorded at a total labour cost of $7,200. Assume that instead of producing 3,640 bottles of Clean-All during the month, the company produced only 2,000 bottles, using 19,000 millilitres of material. (The rest of the material purchased remained in raw materials inventory.) Required. Compute the direct materials price and quantity variances for the month. (Indicate the effect of each variance by selecting "F" for favourable, "U" for unfavourable, and "None" for no effect (i.e., zero variance).) Materials price variance Materials quantity variance
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