Standard Costs and Variance Analysis Paper 8

1

"A company manufactures one product and has a standard cost system. In April the company had the following experience:"
Direct Materials Direct Labor
Actual $/unit of input (lbs. & hrs.) $18 $18
Standard price/unit of input $24 $20
Standard inputs allowed per unit of output 10 4
Actual units of input 190000 78000
Actual units of output 20000 20000
The direct materials price variance for April is






2

"A company manufactures one product and has a standard cost system. In April the company had the following experience:"
Direct Materials Direct Labor
Actual $/unit of input (lbs. & hrs.) $18 $18
Standard price/unit of input $24 $20
Standard inputs allowed per unit of output 10 4
Actual units of input 190000 78000
Actual units of output 20000 20000
The direct materials efficiency variance for April is






3

"A company manufactures one product and has a standard cost system. In April the company had the following experience:"
Direct Materials Direct Labor
Actual $/unit of input (lbs. & hrs.) $18 $18
Standard price/unit of input $24 $20
Standard inputs allowed per unit of output 10 4
Actual units of input 190000 78000
Actual units of output 20000 20000
The direct labor rate variance for April is






4

One of the items produced by a manufacturer of lawn and garden tools is a chain saw. The direct labor standard for assembling and testing a chain saw is 2.5 hours at $8 per hour. Budgeted production for October was 1,200 units. Actual production during the month was 1,000 units, and direct labor cost was $27,840 for 3,200 hours. Using a two-variance system, what was the direct labor rate variance for October?






5

One of the items produced by a manufacturer of lawn and garden tools is a chain saw. The direct labor standard for assembling and testing a chain saw is 2.5 hours at $8 per hour. Budgeted production for October was 1,200 units. Actual production during the month was 1,000 units, and direct labor cost was $27,840 for 3,200 hours. Using a two-variance system, what is the direct labor efficiency variance?






6

A manager prepared the following table by which to analyze labor costs for the month:
Actual Hours at Actual Rate $10,000
Actual Hours at Standard Rate $9,800
Standard Hours at Standard Rate $8,820
What variance was $980?






7

The total budgeted direct labor cost of a company for the month was set at $75,000 when 5,000 units were planned to be produced. The following standard cost, stated in terms of direct labor hours (DLH), was used to develop the budget for direct labor cost:
1.25 DLH × $12.00/DLH = $15.00/unit produced
The actual operating results for the month were as follows:
Actual units produced 5,200
Actual direct labor hours worked 6,600
Actual direct labor cost $77,220
The direct labor efficiency variance for the month would be






8

Normal Company produced 600 units of one of its products last year. The standard for labor hours allowed was 2 hours per unit at a standard rate of $6 per hour. Actual hours worked amounted to 1,230 hours. The labor rate variance was $246 unfavorable, and the labor efficiency variance was $180 unfavorable. What was the actual direct labor cost for the period?






9

Bell Co. manufactures a single product with a standard direct labor cost of 2 hours at $10.00 per hour. During November, 1,500 units were produced requiring 3,200 hours at $10.25 per hour. What was the unfavorable direct labor efficiency variance?






10

In which of the following variances is the standard unit cost used in the calculations?






Result

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