FUND.ACCT.PRIN.
25th Edition
ISBN: 9781260247985
Author: Wild
Publisher: RENT MCG
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Textbook Question
Chapter 23, Problem 18E
Exercise 23-18A Detailed
Refer to the information from Exercise 23-17. Compute the following.
1. Variable overhead spending and efficiency variances. Check (1) Variable overhead: Spending. $15,000 U
2. Fixed overhead spending and volume variances.
3. Controllable variance.
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3. Compute the variable manufacturing overhead spending and efficiency variances. (Indicate the effect of each variance by
selecting "F" for favourable, "U" for unfavourable, and "None" for no effect (i.e., zero variance).)
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Variable overhead sponding variance
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Variable overhead efficiency variance
1 U
1 F
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4. Compute the fixed overhead budget and volume variances. (Indicate the effect of variance by selecting "F" for favourable, "U" for
unfavourable, and "None" for no effect (I.e., zero variance).)
Fixed overhead budget variance
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Fixed overhead volumne variance
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0 Nono
In 2 way variance analysis, materials, labor and variable overhead variances maybe broken down to ________ variances.
A. Price and spending
B. Quantity and time
C. spending and efficiency
D. spending and capacity
Fritz Corp. manufactures and sells a single product. The company uses a standard cost system. The standard cost per unit of product follows:
Materials-1 Ib plastic @ $3.00
$ 3.00
Direct labor-1.6 hr @ $10.00.
16.00
Factory overhead.
4,45
Total. .
$23.45
The charges to the manufacturing department for November, when 5,000 units were produced, follow:
Materials-5,300 lb @ $3.00.
$ 15,900
Direct labor-8,200 hr @ $9.80.
80,360
Factory overhead
23,815
Total.
$120,075
The Purchasing department normally buys about the same quantity as is used in production during a month. In November, 5,500 Ib were purchased at a price of $2.90 per pound.
Critical Thinking Problem
REQUIRED:
Calculate the following from standard costs for the data given, using the formulas in Determination of Variances on pages 421-422 and 424:
1. Materials quantity variance.
2. Materials purchase price variance (at time of purchase).
3. Labor efficiency variance.
4. Labor rate variance.
5. Give some reasons as to why both the…
Chapter 23 Solutions
FUND.ACCT.PRIN.
Ch. 23 - Prob. 1QSCh. 23 - Prob. 2QSCh. 23 - Prob. 3QSCh. 23 - Prob. 4QSCh. 23 - Prob. 5QSCh. 23 - Prob. 6QSCh. 23 - Prob. 7QSCh. 23 - Prob. 8QSCh. 23 - Prob. 9QSCh. 23 - Prob. 10QS
Ch. 23 - Prob. 11QSCh. 23 - Prob. 12QSCh. 23 - Prob. 13QSCh. 23 - Prob. 14QSCh. 23 - Volume variance P3 Refer to information in QS...Ch. 23 - Prob. 16QSCh. 23 - Prob. 17QSCh. 23 - Prob. 18QSCh. 23 - Prob. 19QSCh. 23 - Prob. 20QSCh. 23 - Prob. 21QSCh. 23 - Prob. 22QSCh. 23 - Prob. 23QSCh. 23 - Prob. 24QSCh. 23 - Prob. 25QSCh. 23 - Exercise 23-1 Management by exception C1 Resset...Ch. 23 - Prob. 2ECh. 23 - Exercise 23-2 Preparing flexible budgets P1 Tempo...Ch. 23 - Prob. 4ECh. 23 - Prob. 5ECh. 23 - Prob. 6ECh. 23 - Prob. 7ECh. 23 - Prob. 8ECh. 23 - Prob. 9ECh. 23 - Prob. 10ECh. 23 - Prob. 11ECh. 23 - Prob. 12ECh. 23 - Exercise 23-13 Computing and interpreting...Ch. 23 - Prob. 14ECh. 23 - Exercise 23-15
Direct materials and direct labor...Ch. 23 - Prob. 16ECh. 23 - Prob. 17ECh. 23 - Exercise 23-18A Detailed overhead variances P5...Ch. 23 - Prob. 19ECh. 23 - Prob. 20ECh. 23 - Prob. 21ECh. 23 - Prob. 22ECh. 23 - Prob. 23ECh. 23 - Prob. 24ECh. 23 - Prob. 25ECh. 23 - Prob. 26ECh. 23 - Prob. 27ECh. 23 - Prob. 28ECh. 23 - Prob. 1PSACh. 23 - Prob. 2PSACh. 23 - Prob. 3PSACh. 23 - Prob. 4PSACh. 23 - Prob. 5PSACh. 23 - Prob. 6PSACh. 23 - Prob. 1PSBCh. 23 - Prob. 2PSBCh. 23 - Prob. 3PSBCh. 23 - Prob. 4PSBCh. 23 - Prob. 5PSBCh. 23 - Prob. 6PSBCh. 23 - Prob. 23SPCh. 23 - Flexible budgets and standard costs emphasize the...Ch. 23 - Prob. 2AACh. 23 - Prob. 3AACh. 23 - Prob. 1DQCh. 23 - Prob. 2DQCh. 23 - Prob. 3DQCh. 23 - Prob. 4DQCh. 23 - Prob. 5DQCh. 23 - Prob. 6DQCh. 23 - Prob. 7DQCh. 23 - Prob. 8DQCh. 23 - Prob. 9DQCh. 23 - Prob. 10DQCh. 23 - Prob. 11DQCh. 23 - Prob. 12DQCh. 23 - Prob. 13DQCh. 23 - How can the manager of advertising sales at Google...Ch. 23 - Prob. 15DQCh. 23 - Prob. 16DQCh. 23 - Prob. 1BTNCh. 23 - Prob. 2BTNCh. 23 - Prob. 3BTNCh. 23 - Prob. 4BTN
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- #20 The total overhead variance is equal to the Group of answer choices sum of the total materials variance and the total labor variance. difference between the total materials variance and the total labor variance. sum of the controllable variance and the volume variance. total variance minus the controllable variance and the volume variance.arrow_forward11 21 To produce 1,000 units of the product, the standard prime costs are as follows : Direct materials Materials Kilos 500 Direct labor Per kilo Amount Type Hours Per hour P 5 Amount P 150 A P.10 P. 50 30 20 .30 B 350 400 70 120 Y 20 50 3 2 60 100 310 1,250 240 100 Factory overhead has been estimated at the normal capacity of 1,200 hours as follows : Eixed P 1,200 In producing 10,000 units of the product the company incurred factory overhead of Variable P 2,400 P3.320 and the prime costs of; Direct Materials Per Kilo P.09 Direct labor Type Hours Per hour 275 Amount P 1,402.50 650.70 Materials Kilos Amount P 5.10 540 440 A 6,000 2,000 3,000 11,000 B .22 Y 241 2.70 .33 990 594 1.95 P 1,970 1,158.30 P 3,211.50 1,110arrow_forwardExercise 21-10 Direct labor variances P3 Refer to the information in Exercise 21-8 and compute the (1) direct labor rate variance and (2) direct labor efficiency variance. Indicate whether each variance is favorable or unfavorable.arrow_forward
- Question 9.5 When analyzing the total variable overhead cost variance into both spending and efficiency variances, it is often assumed that direct labour hours is the sole cost driver. Submission Instructions: Explain if direct labour costs could ever be a better cost driver of variable overhead costs than direct labour hours. How would ABC system affect the overhead variances?arrow_forward6.2 Find the budgeted flexible overhead Find the standard overhead applied Fill out the variances column Thank youarrow_forwardHutto Corp. has set the following standard direct materials and direct labor costs per unit for the product it manufactures. Direct materials (14 lbs. @ $3 per lb.) $42 32 Direct labor (2 hrs. @ $16 per hr.) During May the company incurred the following actual costs to produce 8,600 units. Direct materials (124,100 lbs. @ $2.80 per lb.) Direct labor (20,900 hrs. @ $16.10 per hr.). $347,480 336,490 AH = Actual Hours SH= Standard Hours AR Actual Rate SR Standard Rate AQ = Actual Quantity SQ = Standard Quantity AP Actual Price SP = Standard Price (1) Compute the direct materials price and quantity variances. (Indicate the effect of each variance by selecting for favorable, unfavorable, and no variance.) (2) Compute the direct labor rate variance and the direct labor efficiency variance. (Indicate the effect of each variance by selecting for favorable, unfavorable, and no variance. Round "Rate per hour" answers to 2 decimal places.) Complete this question by entering your answers in the…arrow_forward
- Using 6-way variance analysis, determine the following variances: 4. Cost volume variance 5. Cost factor 6. Cost-Quantity factor Format: 111,111 U or 111,111 Farrow_forwardM Question 6 - Ch 23: HOME ation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252Fnewconnect.mheducation. Trini Company set the following standard costs per unit for its single product Direct materials (30 pounds @ $5.00 per pound) Direct labor (7 hours @ $14 per hour) Variable overhead (7 hours @ $7 per hour) Fixed overhead (7 hours @ $9 per hour) Standard cost per unit Production (in units) Standard direct labor hours (7 DLH per unit) Budgeted overhead (flexible budget) Fixed overhead Variable overhead Overhead is applied using direct labor hours. The standard overhead rate is based on a predicted activity level of 80% the company's capacity of 51,000 units per quarter. The following additional information is available. Direct materials (1,377,000 pounds @ $5.00 per pound) Direct labor (321,300 hours @ $14 per hour) Overhead (321,300 hours @ $16 per hour) Standard (budgeted) cost Variable overhead Actual cost Saved 80 F3 Actual costs incurred during…arrow_forwardIdentify the statement related to controllable variance. Statement 1: General increase in the labor rate Statement 2: Increase in the rate of insurance premium Statement 3: Change in market prices of material Statement 4: Excess usage of material a. Statement 1 b. Statement 4 c. Statement 2 d. Statement 3arrow_forward
- Data table Variable manufacturing overhead costs incurred Variable manufacturing overhead cost rate Fixed manufacturing overhead costs incurred Fixed manufacturing overhead costs budgeted Denominator level in machine-hours Standard machine-hour allowed per unit of output Units of output Actual machine-hours used Ending work-in-process inventory $687,100 $9 per standard machine-hour $146,500 $141,000 70,500 1.2 64,800 75,500 0arrow_forwardCompute for the variances of the problem using the information given. Answer the numbers only up to two decimal places. A. Compute for Labor Efficiency Variance B. Compute for Labor Spending Variance C. Compute for Labor Rate Variancearrow_forwardFormat: 11,111 U or 11,111 F 1. Sales price variance 2. Cost price variance 3. Quantity variance 4. Sales mix variancearrow_forward
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What is variance analysis?; Author: Corporate finance institute;https://www.youtube.com/watch?v=SMTa1lZu7Qw;License: Standard YouTube License, CC-BY