FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Standard DM price per pound (Lbs): $20
Standard DM needed per unit: 2 Lbs
Standard DL rate: $15 per hour
Standard DL hours per unit: 2 hours of Direct Labor per unit
*The actual DM used for 11000 units of production is 24200 lbs which means:
24200 lbs / 11000 actual units produced = 2.2 lbs actual quantity of DM used per unit
Actual DL hours: 20000 hours
Variable
*Note: I am helping you here!
- AQ (AP-SP) = DM Price Variance
- (AQ x AP) - (AQ x SP) = -42000 Favorable (less spending for DM)
- $442,000 - (24200 x $20) = DM Price Variance
- 442,000 - 484,000 = DM Price Variance
- $42,000 Favorable DM Price Variance
please answer the following questions:
1. After preparing DM
2. Material price variance :
3. Total Material spending variance:
4. Labor efficiency variance:
Transcribed Image Text:1
2
3
4
14
5
6
7
8
9
10
11 Fixed factory overhead
12 Total manufacturing costs
13
15
A
C
D
E
Click in the boxed area beneath the word "Budget," and use the associated pick list to
select alternative volume levels. The budget column values change (i.e., "flexible")
based on volume. Examine the results and respond to the question at the bottom of the
page, which will turn green upon selecting the correct response.
Ready
Variable Manufacturing
Direct material
Direct labor
Variable factory overhead
Total variable costs
B
Problem
Accessibilit
Budget Analysis for June, 20XX
+
Actual
$ 442,000
328,000
215,000
SA
11,000 units
SA
Budget
$
Which level of volume is consistent with the manager's claim? >>>>
440,000
330,000
220,000
985,000 $
990,000
255,000
250,000
$ 1,240,000 $ 1,240,000
$
SA
$
Variance
(2,000)
2,000
5,000
5,000
(5,000)
11,000 units
F
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