Kansas Company uses a standard cost accounting system. In 2014, the company prod
ID: 2423076 • Letter: K
Question
Kansas Company uses a standard cost accounting system. In 2014, the company produced 27,700 units. Each unit took several pounds of direct materials and 1.6 standard hours of direct labor at a standard hourly rate of $12.00. Normal capacity was 49,780 direct labor hours. During the year, 131,900 pounds of raw materials were purchased at $0.96 per pound. All materials purchased were used during the year. X Your answer is incorrect. Try again. If the materials price variance was $3,957 favorable, what was the standard materials price per pound? (Round answer to 2 decimal places, e.g. 2.75.) Standard materials price per pound LINK TO TEXT LINK TO TEXT Your answer is incorrect. Try again. If the materials quantity variance was $18,147 unfavorable, what was the standard materials quantity per unit? (Round answer to 1 decimal places, e.g. 1.5. Standard materials quantity per unitExplanation / Answer
Direct Material Price Variance= (Actual Qty*Std Price)-(Actual Qty*Actual Price)
3957=(131900*SP)-(131900*0.96)
3957+126624=131900*SP
SP= 0.99
Standard Price Per Pound= 0.99
Materila Qty Variance= (SQ-AQ)*SP
--18147=(SQ-131900)0.99
-18147=0.99SQ-130581
SQ=113570
Material Qty Per Unit=113570/27700
=5 Qty
Standard Hours allowed= 27700*1.6*
=44320
Labour Qty Variance=Standard Rate(Standard Hours-Actual Hours)
-5040= 1.6(44320-AH)
AH= 47470
Labour Price Variance=AQ(SP-AP)
11632=47470(12-AP)
AP=11.75
Predetermined Overhead Rate= Total Budgeted Manufacturing Overhead Cost/ Labour Hours at Normal Capacity
=343482/49780
= 6.9
Standard Cost Per Unit= Total Cost/Standard Units
=343482/27700
=12.40
Overhead applied=Total Buddget cost/Budgeted Labour Hours
=343482/44320
=7.75
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