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9 newconnect.mheducation.com ided Solutions and Study Help Chegg.com Chegg Study Guided Solutions and Study Help Chegg.com Students Home pter 10 Homework Problems 6 Saved 4 Mickley Corporation produces two products, Alpha6s and Zeta7s, which pass through two operations, Sintering and the products uses two raw materials-X442 and Y661. The company uses a standard cost system, with the fo each product (on a per unit basis): two operations, Sintering and Finishing. Each of nts Raw Material Product Alpha6 Zeta? x442 2.0 kilos 5.0 kilos Standard Labor Tine sintering 0.20 hours 0.90 hours 0.40 hours 1.00 hours Finishing Y661 3.0 liters 4.0 liters Information relating to materials purchased and materials used in production during May follows Used in Purchase Cost Standard Price Priet Material x442 Y661 Purchases Producti 15,500 kilos $48,050 $2.90 per kilo 16,500 1iters $29,700 $1.90 per liter 10,000 kilon 14,500 liters ReferenceS The following additional information is aveilable: a. The company recognizes price variances when materials are purchased b. The standard lebor rate is $22.00 per hour in Sintering and $20.50 per hour in Finishing. c. During May, 1,320 direct labor-hours were worked in Sintering at a total labor cost of $31,680, and 3,000 direct labor-hours were worked in Finishing at a total labor cost of $67,500 d. Production during May was 2,100 Alpha6s and 1,220 Zeta7s Required: 1. Complete the standard cost card for each product, showing the standard cost of direct materials and direct labor 2. Compute the materials price and quantity variances for each material. 3. Compute the labor rate and efficiency variances for each operation

Explanation / Answer

1 Standard Quantity or Hours Standard price or Rate Standard Cost Alpha 6 Direct Materials-X442 2 2.9 5.8 Direct Materials-Y661 3 1.9 5.7 Direct Labor-Sintering 0.2 22 4.4 Direct Labor- Finishing 0.9 20.5 18.45 Total 34.35 Zeta7: Direct Materials-X442 5 2.9 14.5 Direct Materials-Y661 4 1.9 7.6 Direct Labor-Sintering 0.4 22 8.8 Direct Labor- Finishing 1 20.5 20.5 Total 51.4 2 Material Price Variance - (Actual Quantity Purchased*Actual unit Cost)-(Actual Quantity Purchased*Standard Unit Cost) Material X442 (48050)-(15500*2.90) 3100 U Material Y661 (29700)-(16500*1.9) -1650 F Material Quantity Variance - Material X442 Actual used 10000 Standard Used (2100*2) 4200 (1220*5) 6100 10300 Difference in Quantity -300 Standard Rate 2.9 -870 F Material Y661 Material Actual used 14500 Standard Used (2100*3) 6300 (1220*4) 4880 11180 Difference in Quantity 3320 Standard Rate 1.9 6308 U 3 Labor Rate Variance Sintering (Actual rate - Standard Rate)*Actual Hours worked (31680/1320 - 22)*1320 2640 U Finishing (67500/3000 - 20.50)*3000 6000 U Labor Efficiency Variance Sintering Actual Hours worked 1320 Standard Hours (2100*0.20) 420 (1220*0.40) 488 908 412 Standard rate 22 Labor Efficiency Variance 9064 U Finishing Actual Hours worked 3000 (2100*0.90) 1890 (1220*1) 1220 3110 -110 Standard Rate 20.5 Labor Efficiency Variance -2255 F

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