Assembly of product P13 requires one unit of component X, twounits of component

Question

Assembly of product P13 requires one unit of component X, twounits of component Y, and three units of component Z. JobJ372 produced 220 units of P13. THe following information pertains to material variances for this job, analyzedby componet:                                               Component                                           X                       Y             Z Pricevariance                    160U            120F           192U Quantityvariance                168U              100U         84F The actual material prices were 0.30 more, 0.20 less, and 0.50more per unit for components X,Y,Z respectively, than theirstandard material prices per unit. a. Determine the number of materials units consumed ofeach type of component. b. Determine the standard materials price per unit ofeach type of component. Assembly of product P13 requires one unit of component X, twounits of component Y, and three units of component Z. JobJ372 produced 220 units of P13. THe following information pertains to material variances for this job, analyzedby componet:                                               Component                                           X                       Y             Z Pricevariance                    160U            120F           192U Quantityvariance                168U              100U         84F The actual material prices were 0.30 more, 0.20 less, and 0.50more per unit for components X,Y,Z respectively, than theirstandard material prices per unit. a. Determine the number of materials units consumed ofeach type of component. b. Determine the standard materials price per unit ofeach type of component.

Explanation / Answer

a. Determine the number of materials units consumed ofeach type of component.              For ComponentX      ActualPrice(AP)   -   StandardPrice(SP)   =   + 0.30       ====================================================       Materials Price Variance(MPV)      =   [ActualPrice(AP)   -   Standard Price(SP)] xActual Quantity(AQ)                         160   =   0.30x AQ             AQ   =   160/ 0.30   =   533.33 units       For ComponentY      ActualPrice(AP)   -   StandardPrice(SP)   =   - 0.20       ====================================================          Materials Price Variance(MPV)      =   [ActualPrice(AP)   -   Standard Price(SP)] xActual Quantity(AQ)            -120   =  - 0.20x AQ             AQ   =   120/ 0.20   =   600 units       For ComponentZ      ActualPrice(AP)   -   StandardPrice(SP)   =   + 0.50       ====================================================          Materials Price Variance(MPV)      =   [ActualPrice(AP)   -   Standard Price(SP)] xActual Quantity(AQ)                 192   =   +0.50 x AQ             AQ   =   192/ 0.50   =   384 units             AQ   =   192/ 0.50   =   384 units ____________________________________________________________________________________________ b. Determine the standard materials price per unit ofeach type of component.      ==================================================       Materials QuantityVariance(MQV)   =   [ActualQuantity(AQ)   -   StandardQuantity(SQ)] x Standard Price(SP) b. Determine the standard materials price per unit ofeach type of component.      ==================================================       Materials QuantityVariance(MQV)   =   [ActualQuantity(AQ)   -   StandardQuantity(SQ)] x Standard Price(SP)       For ComponentX      ActualQuantity   =   533.33 units ( ascalculated in (a) above )       ==========================================================       Materials QuantityVariance(MQV)   =   [ActualQuantity(AQ)   -   StandardQuantity(SQ)] x Standard Price(SP)             168   =   [533.33units    -   (220 units of P13 x1 unit of component X)] x SP             SP   =   168   /   313.33   =   0.536per unit of component X       For ComponentY      ActualQuantity   =   600 units ( ascalculated in (a) above )       ==========================================================       Materials QuantityVariance(MQV)   =   [ActualQuantity(AQ)   -   StandardQuantity(SQ)] x Standard Price(SP)             100   =   [600units    -   (220 units of P13 x2 unit of component Y)] x SP             SP   =   100   /   160   =   0.625per unit of component Y       For ComponentZ      ActualQuantity   =   384 units ( ascalculated in (a) above )       ==========================================================       Materials QuantityVariance(MQV)   =   [ActualQuantity(AQ)   -   StandardQuantity(SQ)] x Standard Price(SP)             -84   =   [384units    -   (220 units of P13 x3 unit of component Y)] x SP             SP   =   -84   /  - 276   =   0.304per unit of component Z ____________________________________________________________________________________________ If you want to know the actual rate this can be obtained asfollows: For X    =   $0.536 SP +$0.30   =   $0.836 For Y    =   $0.625SP -  $0.20   =   $0.425 For Z    =   $0.304SP +  $0.50   =   $0.804                    ==========================================================       Materials QuantityVariance(MQV)   =   [ActualQuantity(AQ)   -   StandardQuantity(SQ)] x Standard Price(SP)             168   =   [533.33units    -   (220 units of P13 x1 unit of component X)] x SP             SP   =   168   /   313.33   =   0.536per unit of component X       For ComponentY      ActualQuantity   =   600 units ( ascalculated in (a) above )       ==========================================================       Materials QuantityVariance(MQV)   =   [ActualQuantity(AQ)   -   StandardQuantity(SQ)] x Standard Price(SP)             100   =   [600units    -   (220 units of P13 x2 unit of component Y)] x SP             SP   =   100   /   160   =   0.625per unit of component Y             100   =   [600units    -   (220 units of P13 x2 unit of component Y)] x SP             SP   =   100   /   160   =   0.625per unit of component Y       For ComponentZ      ActualQuantity   =   384 units ( ascalculated in (a) above )       ==========================================================       Materials QuantityVariance(MQV)   =   [ActualQuantity(AQ)   -   StandardQuantity(SQ)] x Standard Price(SP)             -84   =   [384units    -   (220 units of P13 x3 unit of component Y)] x SP             SP   =   -84   /  - 276   =   0.304per unit of component Z ____________________________________________________________________________________________ If you want to know the actual rate this can be obtained asfollows: For X    =   $0.536 SP +$0.30   =   $0.836 For Y    =   $0.625SP -  $0.20   =   $0.425 For Z    =   $0.304SP +  $0.50   =   $0.804                    ==========================================================       Materials QuantityVariance(MQV)   =   [ActualQuantity(AQ)   -   StandardQuantity(SQ)] x Standard Price(SP)             -84   =   [384units    -   (220 units of P13 x3 unit of component Y)] x SP             SP   =   -84   /  - 276   =   0.304per unit of component Z ____________________________________________________________________________________________ If you want to know the actual rate this can be obtained asfollows: For X    =   $0.536 SP +$0.30   =   $0.836 For Y    =   $0.625SP -  $0.20   =   $0.425 For Z    =   $0.304SP +  $0.50   =   $0.804                          -84   =   [384units    -   (220 units of P13 x3 unit of component Y)] x SP             SP   =   -84   /  - 276   =   0.304per unit of component Z ____________________________________________________________________________________________ If you want to know the actual rate this can be obtained asfollows: For X    =   $0.536 SP +$0.30   =   $0.836 For Y    =   $0.625SP -  $0.20   =   $0.425 For Z    =   $0.304SP +  $0.50   =   $0.804             

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