FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Transcribed Image Text:**Bandar Industries Manufacturing Cost Analysis**
Bandar Industries manufactures sporting equipment. One of the company's products is a football helmet that requires special plastic. During the quarter ending June 30, the company manufactured 3,300 helmets, using 2,178 kilograms of plastic. The plastic cost the company $16,553.
According to the standard cost card, each helmet should require 0.57 kilograms of plastic, at a cost of $8.00 per kilogram.
**Required:**
1. **Standard Quantity of Kilograms of Plastic (SQ):**
- Determine the allowed kilograms of plastic to make 3,300 helmets.
2. **Standard Materials Cost Allowed (SQ × SP):**
- Calculate this cost for 3,300 helmets.
3. **Materials Spending Variance:**
- Compute the variance in spending on materials.
4. **Materials Price Variance and Materials Quantity Variance:**
- Analyze both variances.
**Instructions for Analysis:**
- For requirements 3 and 4, 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.
- Do not round intermediate calculations.
**Required Calculations and Analysis Table:**
1. **Standard Quantity of Kilograms Allowed**
2. **Standard Cost Allowed for Actual Output**
3. **Materials Spending Variance**
4. **Materials Price Variance**
5. **Materials Quantity Variance**
This guide assists in analyzing the material variances encountered during the manufacturing process.
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