Exam 24: Standard Cost Systems

[The following information applies to the questions displayed below.] The Starbright Corporation has compiled the following data.The company intends to use this information to develop standard costs per unit for its single product: Direct materials = $50 per ton Direct labor = $12.75 per hour Variable manufacturing overhead = $5 per direct labor hour Fixed manufacturing overhead = $18,700 Expected production = 1,700 units Each unit of the company's single product requires 2.5 tons of direct materials and 22.5 hours to manufacture. -What is the standard total manufacturing overhead cost?

If fewer units are produced than had been estimated when standard unit costs were determined,there would normally be:

[The following information applies to the questions displayed below.] James Inc.'s flexible budget for June,based upon actual output,called for the use of 10,500 pounds of materials at a standard cost of $7.40 per pound.The Production Department actually used 10,700 pounds of materials costing $7.10 per pound during June. -The materials quantity variance for James's June operations is:

Standard cost systems are generally compatible with job cost systems or with process cost systems.

A favorable variance occurs when actual costs are less than standard costs.

In setting standard costs,management's expectations are that the standard costs will always be met.

Standard cost system-using variance data During its first month of operations,the Beech Company charged Work in Process Inventory with $40,000 of direct materials,$46,000 of direct labor costs,and $80,000 of manufacturing overhead costs.Beech Company uses a standard cost system,and the variances at the end of this first month are as follows: (a)Compute the actual cost of direct materials placed into production during the month.$________ (b)Compute the actual cost of direct labor hours worked during this month.$________ (c)Compute the actual cost of manufacturing overhead for this month.$________ (d)Assume that the balance in the Work in Process account is $6,000 at the end of this first month.If total standard unit cost is $20 per unit,the number of units completed during this month and transferred to Finished Goods Inventory is ________ units.

[The following information applies to the questions displayed below.] Eagle Company uses a standard cost system that has provided the following data: -The direct labor efficiency variance for the period was:

If actual direct labor cost was $7,560 and standard labor cost was $7,000,the journal entry to record this would include:

An unfavorable labor efficiency variance is most likely to occur if:

Roman's labor efficiency variance for July is:

Standard costs actually are ideal costs per unit.

An unfavorable labor rate variance could most likely result from all of the following except:

A materials price variance is arrived at by taking standard quantity multiplied by actual price,less standard price.

If the standard quantity of materials is 84,500 units at $0.15 per unit and the actual quantity is 95,000 units at $0.12 per unit,then the materials price variance is:

A labor efficiency variance relates to the number of hours actually worked,compared to the standard hours.

Standard costs are established only for direct labor and direct materials.

The total overhead variance is the difference between:

A favorable materials price variance indicates that actual prices paid in acquiring materials were more than standard prices.

The journal entry to record the cost of direct labor used in this period includes: