Exam 11: Standard Costs and Operating Performance Measures

Arlon Jeffries Candy Corporation produces and sells taffy by the bag and uses a standard cost system to collect costs related to production. The following information relates to Arlon Jeffries' operations for last month: Required: Compute the unknown quantities above. (Numbers 4, 6, 7, and 10.)

The following data have been provided by Montis Corporation: Required: Compute the variable overhead rate variances for lubricants and for supplies. Indicate whether each of the variances is favorable (F) or unfavorable (U). Show your work!

Direct labor standards at Cepeda Manufacturing Corporation allow 5 direct labor-hours for every unit produced. The standard direct labor rate is $12.00 per hour. During the month of February, Cepeda incurred 35,000 direct labor-hours and recorded a $15,000 favorable labor efficiency variance. How many units did Cepeda produce during February?

The following labor standards have been established for a particular product: The following data pertain to operations concerning the product for the last month: -What is the labor efficiency 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: -What is the materials price variance for the month?

The following data for January have been provided by Hillin Corporation, a producer of precision drills for oil exploration: Required: Compute the variable overhead rate variances for indirect labor and for power for January. Indicate whether each of the variances is favorable (F) or unfavorable (U). Show your work!

Mcgann Corporation is developing standards for its products. Each unit of output of the product requires 0.53 kilogram of a particular input. The allowance for waste and spoilage is 0.06 kilogram of this input for each unit of output. The allowance for rejects is 0.12 kilogram of this input for each unit of output. The standard quantity in kilograms of this input per unit of output should be:

If variable overhead is applied on the basis of direct labor-hours and the variable overhead rate variance is favorable, then:

Dezan Corporation is developing direct labor standards. A particular product requires 0.90 direct labor-hours per unit. The allowance for breaks and personal needs is 0.04 direct labor-hours per unit. The allowance for cleanup, machine downtime, and rejects is 0.13 direct labor-hours per unit. Required: Determine the standard direct labor-hours per unit of product. Show your work!

Cole laboratories makes and sells a lawn fertilizer called Fastgro. The company has developed standard costs for one bag of Fastgro as follows: The company had no beginning inventories of any kind on Jan. 1. Variable overhead is applied to production on the basis of standard direct labor-hours. During January, the following activity was recorded by the company: Production of Fastgro: 4,000 bags Direct materials purchased: 85,000 pounds at a cost of $32,300 Direct labor worked: 390 hours at a cost of $4,875 Variable overhead incurred: $1,475 Inventory of direct materials on Jan. 31: 3,000 pounds -The materials quantity variance for January is:

Ideal standards can only be attained under the best circumstances and allow for no work interruptions.

In a certain standard costing system the following results occurred last period: labor rate variance, $1,000 U; labor efficiency variance, $2,800 F; and the actual labor rate was $0.20 more per hour than the standard labor rate. The number of actual direct labor-hours used last period was:

In a recent period 12,250 units were made and there was a favorable labor efficiency variance of $22,500. If 41,000 labor-hours were worked and the standard wage rate was $12 per labor-hour, the standard hours allowed per unit of output is closest to:

The following standards for variable overhead have been established for a company that makes only one product: The following data pertain to operations for the last month: Required: a. What is the variable overhead rate variance for the month? b. What is the variable overhead efficiency variance for the month?

Osier Corporation, which produces cellular transmission towers, has provided the following data: -The variable overhead efficiency variance for indirect labor is:

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

The Fletcher Company uses standard costing. The following data are available for October: The standard quantity of material allowed for October production is:

A favorable materials price variance coupled with an unfavorable material usage variance would most likely result from:

Cole laboratories makes and sells a lawn fertilizer called Fastgro. The company has developed standard costs for one bag of Fastgro as follows: The company had no beginning inventories of any kind on Jan. 1. Variable overhead is applied to production on the basis of standard direct labor-hours. During January, the following activity was recorded by the company: Production of Fastgro: 4,000 bags Direct materials purchased: 85,000 pounds at a cost of $32,300 Direct labor worked: 390 hours at a cost of $4,875 Variable overhead incurred: $1,475 Inventory of direct materials on Jan. 31: 3,000 pounds -The labor rate variance for January is:

Quantity standards indicate how much of an input should be used for manufacturing a unit of product or in providing a unit of service.