Vitex, Inc. manufactures a popular consumer product and it has provided the foll

Question

Vitex, Inc. manufactures a popular consumer product and it has provided the following data excerpts from its standard cost system: Standard (1) Standard Quantity or Standard Price Cost 2.20 pounds 1.09 hours $17.03 per pound $15.88 per hour 37.48 $ 15.88 Direct materials Direct labor Variable manufacturing overhead Total standard cost per unit 1.00 hours 9.10 per hour 5 9.18 62.38 Standard Price Quantity or Cost*or RateEfficiency $673,200 s 12,064 F $ 34,888 LU $284,480 S 3,880 u S 15,880 U $163,880 S 4,008 F su Direct materials Direct labor Variable manufacturing overhead Applied to Work in Process during the period The company's manufacturing overhead cost is applied to production on the basis of direct labor-hours. All of the materials purchased during the period were used in production. Work in process inventories are insignificant and can be ignored Required: 1. How many units were produced last period? 2. How many pounds of direct material were purchased and used in production? 3. What was the actual cost per pound of material? (Round your answer to 2 decimal places.) 4. How many actual direct labor-hours were worked during the period? 5. What was the actual rate paid per direct labor-hour? (Round your answer to 2 decimal places) 6. How much octual variable manufecturing overhead cost was incurred during the perioo? 1.Number of units produced 2. Pounds of direct material purchased and used in production 3. Actual cost per pound 4. Actual direct labor-hours 5 Actual rate per direct labor-hour 6. Act al vanable manufacturing overhead cost

Explanation / Answer

1. Number of units produced = 18,000 units

Explanation:

= Total Standard cost / Standard cost per unit

Total standard cost = 673,200 , Standard cost per unit = 37.40

= 673,200 / 37.40 = 18,000

2. Pounds of direct material purchased and used in production = 41,600

Explnation:

Material Quantity variance = (standard quantity - actual quantity) Standard price

Let Actual quantity = x

Material Quantity variance = -34,000 , standard quantity = 18,000 * 2.20 = 39,600

Standard price = $17

-34,000 = (39,600 - x) 17

-34,000 = 673,200 - 17x

17x = 707,200

Actual quantity = 41,600

3. Actual cost per pound = 16.71 per pound

Explanation:

Material price variance = (Standard price - Actual price) Actual quantity

Let Actual price be x

12,064 = (17 - x) 41,600

12,064 = 707200 - 41,600x

41,600x = 695,136

Actual price = 695,136 / 41,600 = 16.71

4. Actual Direct Labor hours = 19,000 hour

Explanation:

Labor Efficiency Variance = (Standard hour - Actual hour)Standard Rate

Let Actual hour be x

Standard hour = 18,000 * 15.80 = 284,400

Standard Rate = $15.80

Labor Efficiency Variance = -15,000

-15,800 = (18,000 - x)15.80

-15,800 = 284,400 - 15.80x

15.80x = 300,200

Actual hour = 19,000

5. Actual rate per direct labor hour = 16 per direct labor hour

Explanation:

Labor Rate Variance = (Standard Rate - Actual Rate) Actual hour

Let Actual rate be x

Standard Rate = 15.80

Labour Rate Variance = -3,800

-3,800 = (15.80 - x) 19,000

-3,800 = 300,200 - 19,000x

19,000x = 304,000

Actual Rate = 16 per direct labor hour

6. Actual variable manufacturing overhead cost

Explanation:

Variable overhead efficiency variance = (18,000 - 19,000) 9.10

= 9,100 U

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