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##### Standard Costing_Questions on Variances

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Question;Exercise 11-2Hnak Itzek manufactures and sells homemade wine, and he wants to develop a standard cost per gallon. The following are required for production of a 30-gallon batch.2,800 ounces of grape concentrate at $0.04 per ounce39 pounds of granulated sugar at $0.49 per pound53 lemons at $0.71 each120 yeast tablets at $0.22 each120 nutrient tablets at $0.15 each2,600 ounces of water at $0.004 per ounceHank estimates that 5% of the grape concentrate is wasted, 12% of the sugar is lost, and 33% of the lemons cannot be used.Compute the standard cost of the ingredients for one gallon of wine. (Round intermediate calculations and final answer to 2 decimal places, e.g. 1.25.)Standard Cost Per Gallon$Exercise 11-3Kimm Company has gathered the following information about its product.Direct materials: Each unit of product contains 3.70 pounds of materials. The average waste and spoilage per unit produced under normal conditions is 0.60 pounds. Materials cost $1 per pound, but Kimm always takes the 1.53% cash discount all of its suppliers offer. Freight costs average $0.27 per pound.Direct labor. Each unit requires 2.70 hours of labor. Setup, cleanup, and downtime average 0.19 hours per unit. The average hourly pay rate of Kimm?s employees is $12.60. Payroll taxes and fringe benefits are an additional $3.10 per hour.Manufacturing overhead. Overhead is applied at a rate of $6.10 per direct labor hour.Compute Kimm?s total standard cost per unit. (Round answer to 2 decimal places, e.g. 1.25.)Total standard cost per unit$Exercise 11-6Lewis Company?s standard labor cost of producing one unit of Product DD is 3.70 hours at the rate of $12.00 per hour. During August, 42,500 hours of labor are incurred at a cost of $12.14 per hour to produce 11,300 units of Product DD.(a)Compute the total labor variance.Total labor variance$(b)Compute the labor price and quantity variances.Labor price variance$Labor quantity variance$(c)Compute the labor price and quantity variances, assuming the standard is 3.92 hours of direct labor at $12.28 per hour.Labor price variance$Labor quantity variance$Exercise 11-8The following direct materials and direct labor data pertain to the operations of Laurel Company for the month of August.CostsActual labor rate$14 per hourActual materials price$224 per tonStandard labor rate$13 per hourStandard materials price$225 per tonQuantitiesActual hours incurred and used4,107 hoursActual quantity of materials purchased and used1,091 tonsStandard hours used4,187 hoursStandard quantity of materials used1,071 tonsCompute the total, price, and quantity variances for materials and labor.Total materials variance$Materials price variance$Materials quantity variance$Total labor variance$Labor price variance$Labor quantity variance$Exercise 11-11Manufacturing overhead data for the production of Product H by Smart Company are as follows.Overhead incurred for 53,100 actual direct labor hours worked$428,800Overhead rate (variable $7, fixed $1) at normal capacity of 41,100 direct labor hours$8Standard hours allowed for work done54,010Compute the total overhead variance.Total overhead variance$Problem 11-1ACostello Corporation manufactures a single product. The standard cost per unit of product is shown below.Direct materials?2 pound plastic at $6.38 per pound$ 12.76Direct labor?1.50 hours at $11.00 per hour16.50Variable manufacturing overhead11.25Fixed manufacturing overhead6.75Total standard cost per unit$47.26The predetermined manufacturing overhead rate is $12 per direct labor hour ($18.00 ? 1.50). It was computed from a master manufacturing overhead budget based on normal production of 8,250 direct labor hours (5,500 units) for the month. The master budget showed total variable costs of $61,875 ($7.50 per hour) and total fixed overhead costs of $37,125 ($4.50 per hour). Actual costs for October in producing 4,200 units were as follows.Direct materials (8,510 pounds)$ 55,741Direct labor (6,190 hours)69,823Variable overhead53,523Fixed overhead23,877 Total manufacturing costs$202,964The purchasing department buys the quantities of raw materials that are expected to be used in production each month. Raw materials inventories, therefore, can be ignored.(a) Compute all of the materials and labor variances. (Round answers to 0 decimal places, e.g. 125.)Total materials variance$Materials price variance$Materials quantity variance$Total labor variance$Labor price variance$Labor quantity variance$(b) Compute the total overhead variance.Total overhead variance$

Paper#37477 | Written in 18-Jul-2015

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