Exam 10: Standard Costs and Overhead Analysis

Dori Castings is a job order shop that uses a standard cost system to account for its production costs. Manufacturing overhead costs are applied to production on the basis of direct labour hours. -Dori's choice of a production volume as a denominator for calculating its predetermined overhead rate will have NO effect on which of the following?

A furniture manufacturer has a standard costing system based on machine hours (MHs) as the measure of activity. Data from the company's flexible budget for manufacturing overhead are given below: The following data pertain to operations for the most recent period: -What was the total predetermined overhead rate,rounded to the nearest cent?

The following standards for variable manufacturing overhead have been established for a company that makes only one product: Standard hours per unit of output 5.6 hours Standard variable overhead rate \ 12.00 per hour The following data pertain to operations for the last month: Actual hours 2,600 hours Actual total variable overhead cost \ 31,330 Actual output 400 units What was the variable overhead spending variance for the month?

The following materials standards have been established for a particular product: The following data pertain to operations concerning the product for the last month: Required: a) What was the materials price variance for the month? b) What was the materials quantity variance for the month?

The Reedy Company uses a standard costing system.The following data are available for November: Actual direct labour hours worked 5,800 hours Standard direct labour rate \ 9 per hour Labour rate variance \ 1,160 favourable What was the actual direct labour rate for November?

A manufacturing company that has only one product has established the following standards for its variable manufacturing overhead. The company uses direct labour hours (DLHs) as its measure of activity. The following data pertain to operations for the last month: -For March,what was the variable overhead spending variance?

(Appendix 10A) Saskatoon Company uses two raw materials, A and B, in the manufacture of its only product: Zizbo. The materials are very close substitutes. The standard proportions for the manufacture of a unit of Zizbo are 2 units of A and 3 units of B. The unit standard prices of A and B are $10 and $8, respectively. During the month of August, the company used 450 units of A and 750 units of B to produce 230 units of Zizbo. -(Appendix 10A)For raw material B,what were the mix and yield variances,respectively?

The production manager is usually held responsible for the labour efficiency variance.

Which of the following is the most probable reason a company would experience an unfavourable labour rate variance and a favourable labour efficiency variance?

The Clark Company makes a single product and uses standard costing. Some data concerning this product for the month of May follow: -What are the standard hours allowed to make one unit of finished product?

Jessep Corporation has a standard cost system in which manufacturing overhead is applied to units of product on the basis of direct labour hours. The company has provided the following data concerning its fixed manufacturing overhead costs in March: -What was the fixed overhead volume variance?

(Appendix 10B)Drake Company purchased materials on account.The entry to record the purchase of materials having a standard cost of $1.50 per kilogram from a supplier at $1.60 per kilogram would include which of the following?

A manufacturer of playground equipment has a standard costing system based on machine hours (MHs) as the measure of activity. Data from the company's flexible budget for manufacturing overhead are given below: The following data pertain to operations for the most recent period: -What was the fixed overhead volume variance for the period,rounded to the nearest dollar?

What does an unfavourable labour efficiency variance indicate?

Bryan Company employs a standard cost system in which direct materials inventory is carried at standard cost. Bryan has established the following standards for the prime costs of one unit of product: During March, Bryan purchased 165,000 kilograms of direct materials at a total cost of $585,750. The total factory wages for March were $400,000, 90 percent of which were for direct labour. Bryan manufactured 25,000 units of product during March, using 151,000 kilograms of direct materials and 32,000 direct labour hours. -What was the direct labour efficiency variance for March?

In a certain standard costing system,the following results occurred last period: labour rate variance,$1,000 unfavourable; labour efficiency variance,$2,800 favourable; and the actual labour rate was $0.20 more per hour than the standard labour rate.What number of actual direct labour hours was used last period?

Under a standard cost system,who is usually held responsible for the materials price variances?

The variable overhead efficiency variance reflects how efficiently variable overhead resources were used.

If the actual labour hours worked exceed the standard labour hours allowed,what type of variance will occur?

Warner Manufacturing has established the following master flexible budget for the current year: Variable expenses: Raw materials \ 152,000 228,000 Direct labour 160,000 240,000 320,000 Manufacturing overhead Total variable expenses Fixed expenses: Manufacturing overhead \ 300,000 \ 300,000 \ 300,000 Selling and administrative Total fixed expenses \ 492.000 \ 492.000 \ 492.000 Total expenses \ 924.000 \ 1.140.000 \ 1.356,000 Manufacturing overhead is applied on the basis of machine hours. At standard, each unit of product requires one machine hour to complete. Required: a) The denominator activity level is 120,000 units. What are the predetermined variable and fixed manufacturing overhead rates? b) Actual data for the year were as follows: Actual variable manufacturing overhead cost \ 159,500 Actual fixed manufacturing overhead cost \ 305,000 Actual machine hours incurred 110,000 Units produced 105,000 Compute the variable overhead spending and efficiency variances and the fixed overhead budget and volume variances for the year.