Exercise 6-14 Silva Plastics Company has established standard cost for a unit of manufactured product as follows: Materials (3 kgs. @ P9) Labor (1 hour @ P84) Variable overhead (1 hour @ P24) Fixed overhead (1 hour @ P36) P27.00 84.00 24.00 36.00 P171.00 Total standard unit cost At normal operating capacity, 100,000 units of product should be manufactured in a year. Costs data pertaining to the operations for the year are summarized below: Materials purchased (200,000 kgs.) Materials used in production P1,908,000 185,000 kgs. Labor hours 58,000 Labor rate P90.00 per hour P1,380,000 Factory overhead- Variable Fixed P3,600,000 During the year, 60,000 units of product were put into production and were completed. There were no units in process at the beginning or at the end of the year. There are also no inventories of raw materials or finished goods at the beginning of the year. REQUIRED: 1. Determine the materials and labor variances graphically and by formula. 2. Prepare the flexible overhead budget using the format of page 217. 3. Determine the overhead variances using the 2-way method,

Exercise 6-14 Silva Plastics Company has established standard cost for a unit of manufactured product as follows: Materials (3 kgs. @ P9) Labor (1 hour @ P84) Variable overhead (1 hour @ P24) Fixed overhead (1 hour @ P36) P27.00 84.00 24.00 36.00 P171.00 Total standard unit cost At normal operating capacity, 100,000 units of product should be manufactured in a year. Costs data pertaining to the operations for the year are summarized below: Materials purchased (200,000 kgs.) Materials used in production P1,908,000 185,000 kgs. Labor hours 58,000 Labor rate P90.00 per hour P1,380,000 Factory overhead- Variable Fixed P3,600,000 During the year, 60,000 units of product were put into production and were completed. There were no units in process at the beginning or at the end of the year. There are also no inventories of raw materials or finished goods at the beginning of the year. REQUIRED: 1. Determine the materials and labor variances graphically and by formula. 2. Prepare the flexible overhead budget using the format of page 217. 3. Determine the overhead variances using the 2-way method,

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter10: Standard Costing And Variance Analysis

Section: Chapter Questions

Problem 21BEA

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problem 5 Marites Company employs standard absorption system for product costing. The standard cost of this product is as follows: Raw Materials – P14.50; Direct Labor for 2 hours @ P8/hr is P16; Manufacturing overhead for 2 hours @ P11/hr is P22. The total cost/unit (14.50+16+22) = P52.50. The manufacturing overhead rate is based upon normal annual activity level of 600,000 direct labor hours. The company planned to produce 25,000 units each month during 2020. Budgeted factory overhead for 2020 is composed of P3,600,000 variable and P3,000,000 fixed. During April 2021, 26,000 units of product were produced using 53,500 direct labor hours at a cost of P433,350. Actual manufacturing overhead for the month was P260,000 fixed and P315,000 variable. The total manufacturing overhead applied during April was P572,000. The variable overhead spending variance must be:
Exercise 6-14 Silva Plastics Company has established standard cost for a unit of manufacture product as follows: Materials (3 kgs. @ P9) Labor (1 hour @ P84) Variable overhead (1 hour @ P24) Fixed overhead (1 hour @ P36) P27.00 84.00 24.00 36.00 P171.00 Total standard unit cost At normal operating capacity, 100,000 units of product should be manufactured in a year. Costs data pertaining to the operations for the year are summarized below: Materials purchased (200,000 kgs.) Materials used in production P1,908,000 185,000 kgs. Labor hours 58,000 Labor rate P90.00 per hour Factory overhead- Variable P1,380,000 Fixed P3,600,000 During the year, 60,000 units of product were put into production and were completed. There were no units in process at the beginning or at the end of the year. There are also no inventories of raw materials or finished goods at the beginning of the year. REQUIRED: 1. Determine the materials and labor variances graphically and by formula. 2. Prepare the flexible…
Question 6: Your company currently produces a range of three products, D, E, and F to which the following details relate for Period 2. D E F Production (units) 1,500 2,500 14,000 Material cost per unit Br. 18 Br. 10 Br. 20 Labor hours per unit 1 3 2 Machine hours per unit 3 2 6 Labor costs are Br. 8 per hour and production overheads are currently absorbed in the conventional system by reference to machine hours. Total production overheads for Period 2 have been analyzed as follows: Set-up cost 327,250 Handling cost 187,000 Machine cost 140,250 Inspection cost 280,500 935,000 Calculate the cost per unit for each product using conventional The introduction of an ABC is being considered and to that end the following volume…
Exercise 6-14 Silva Plastics Company has established standard cost for a unit of manufactured product as follows: Materials (3 kgs. @ P9) Labor (1 hour @ P84) Variable overhead (1 hour @ P24) P27.00 84.00 24.00 Fixed overhead (1 hour @ P36) Total standard unit cost 36.00 P171.00 At normal operating capacity, 100,000 units of product should be manufactured in a year. Costs data pertaining to the operations for the year are summarized below: Materials purchased (200,000 kgs.) Materials used in production P1,908,000 185,000 kgs. Labor hours Labor rate P90.00 per hour Factory overhead- Variable P1,380,000 P3,600,000 Fixed During the year, 60,000 units of product were put into production and were completed. There were no units in process at the beginnìng or at the end of the year. There are also no inventories of raw materials or finished goods at the beginning of the year. REQUIRED: 1. Determine the materials and labor variances graphically and by formula. 2. Prepare the flexible overhead…
Ch. 10-Dell, Inc. makes a product with the following standard costs: Direct materials Direct labor Variable overhead 4.00per ounce 11.00per hour 4.00per hour The company reported the following results concerning this product in June. Actual output Raw materials used in production Purchases of raw materials Actual direct labor-hours Standard Quantity or Hours Standard Price or Rate 7.1ounces 0.2hours 0.2hours D) $440 F C) $660 U A) $440 U $ $ $ B) $660 F Standard Cost Per Unit 3000units 21,500ounces 21,500ounces 560hours S $ The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. The labor efficiency variance for June is: S 28.40 2.20 0.80
Chhom Incorporated, manufactures and cells two products Product F and Product U4 Data concerning the expected production of each product and the expected total direct labor hours (DLH required to produce that output appear below Product F9 Product 04 Total direct labor-hoursi Expected Direct Labor-Hours Total Direct Production 300 600 Activity Cost Pools Labor-related Production orders order size Per Unit 4.0 2.0 The direct labor rate is $25.90 per DLH The direct materials cost per unit is $285 for Product F9 and $244 for Product 4 The company is considering adopting an activity based costing system with the following activity cost pools, activity measures, and expected activity Activity Measures DLHS orders MHS Estimated Overhead Cost Product $ 42,600 67,630 137,820 $ 248,050 Labor-Hours 1,200 1,200 2,400 1,200 400 3,300 Expected Activity Product U 1,200 GOO 3,100 Total 2,400 1,000 4,400
Question No. 1-2 The estimated costs of producing 6,000 units of a component are: Per Unit Direct Material $10 Direct Labor 8 Applied Variable Factory Overhead 9 Applied Fixed Factory Overhead $1.5 per direct labor dollar The same component can be purchased from market at a price of $29 per unit. If the component is purchased from market, 25% of the fixed factory overhead will be saved. 12 Required: a. Should the component be purchased from the market? b. Being a production manager, provide your iogicai opinion on choosing between purchasing the component from market or producing in-house
QUESTION 2 Wonder Woman Sdn Bhd manufactures two products, the X and the Y, which have the following standard selling price and standard costs per unit. X Y RM RM Standard Selling Price Direct Materials 120 128 32 26 Direct Labour 40 50 Variables Production Overhead 20 16 Variable Selling Overhead 16 27 A production line can be set up to produce either produce either product X or product Y. The following table gives the breakdown for each product. Labour (minutes) Material (kg) Testing (minutes) Product X 30 2 3 Y 15 4 4 In any one week the availability of resources are expected to be subjects to the following limitations: Direct Labour (minutes) Direct Materials 1800 minutes | 280 kg The production department stated that the testing equipment must be used for at least 240 minutes. Also, because of existing orders, at least 20 units of product X must be produced. Required: Determine by graphical means the optimal mix of X and Y at Wonder Woman Sdn Bhd. (Calculate the exact values of X…
QUESTION 6 Your company currently produces a range of three products, D, E and F to which the following details relate for Period 2. Production (units) Material cost per unit Labour hours per unit Machine hours per unit D 1,500 RM 18 Set-up costs Handling costs Machining costs Inspection costs 1 3 Labour costs are RM 8 per hour and production overheads are currently absorbed in the conventional system by reference to machine hours. Total production overheads for Period 2 have been analysed as follows: RM 327,250 187,000 140,250 280,500 935,000 E 2,500 RM 10 3 2 D 90 16 180 F 14,000 RM 20 2 6 (a) Calculate the cost per unit for each product using conventional methods. The introduction of an ABC is being considered and to that end the following volume of activities have been identified with the current output levels. E 138 28 216 F 576 116 804 Number of set-ups Number of material issues Number of inspections (b) Calculate the cost per unit for each product using the ABC approach. (c)…
Figure 11-1Ubben Manufacturing uses an activity-based costing system. The company produces Model X and Model Y. Information relating to the two products is as follows:Model X Model YUnits produced 20,000 40,000Machine hours 8,000 10,000Direct labour hours 14,000 16,000Engineering labour (hours) 1,000 1,400Setups 40 60The following costs are reported:Engineering £ 48,000Setups 100,000Machine-related overhead 144,000 Refer to Figure 11-1. Setups would be classified as a A. unit-level activity.B. facility-level activity.C. batch-level activity.D. total-level activity.
13 The following standard cost card is provided for Navid Company's Product A: Direct material (3 lbs. @ $3.00 per lb.) Direct labor (2 hr @ $6.00 per hr.) Variable overhead (1 hr. @ $4.00 per hr.) Fixed overhead (1 hr. @ $3.00 per hr.) Total standard cost per unit Multiple Choice $21.74. $33.74. $9.00 The fixed overhead rate is based on total budgeted fixed overhead of $10,000. During the period, the company produced a Direct material 10,200 pounds @ $2.50 per pound Direct labor 5,150 hours @ $12.00 per hour Overhead $30,100 The standard manufacturing cost per unit is $28.00. What is the actual manufacturing cost per unit? (Do not round interme $18.41. 12.00 4.00 3.00 $28.00 Cannot be determined from the information provided.
Exercise 6-50 (Algo) Two-Stage Cost Allocation and Predetermined Rates (LO 6-1, 2, 3) Tacoma Accessories makes two laptop cases, Plastic and Leather, that require direct materials, direct labor, and overhead. The following data refer to operations expected for next quarter: Revenue Direct material Direct labor Overhead: Material handling overhead Fabrication overhead Plastic $ 560,000 260,000 140,000 a. Material handling predetermined rate b. Fabrication predetermined rate Leather $ 580,000 340,000 120,000 c. Total overhead (Plastic) d. Total overhead (Leather) Total $ 1,140,000 Required: a. Compute the material handling overhead rate for next quarter. b. Compute the fabrication overhead rate for next quarter. c. What is the total overhead allocated to the Plastic case next quarter? d. What is the total overhead allocated to the Leather case next quarter? Tacoma uses a two-stage cost allocation system: It uses direct-material costs to allocate material handling overhead and direct-…