6. (2 points) A company\'s manufacturing plans were as follows Units to be manuf

Question

6. (2 points) A company's manufacturing plans were as follows Units to be manufactured: Budgeted variable costs Budgeted fixed costs: 1,000 units $50,000 $30,000 Later, the company actually produced 1,200 units, and incurred variable costs of $52,000 and fixed costs of $31,000. What is the amount of the overall spending variance (for all costs together)? Also, indicate whether t is favorable or unfavorable. -> , and Favorable av oose one 7.(2 points) Gyne Company makes Product X using special plastic as the main material. The company made 1,000 units of X using 4,800 lbs of plastic. The plastic cost the company S52,800 According to the company's standards, each unit of X should require 5 lbs of plastic, at a price of $20 per lbs What cost of plastic should have been incurred to make 1,000 units of X? In another words, what is the standard cost of 1,000 units together? 8. (2points) Use the same information given in the above question. Assume that the company had paid the same price per lbs of plastic that the standard requires. Still the actual cost would have beern different from the standard cost by what amount? Also, indicate whether that difference would have been favorable or unfavorable and

Explanation / Answer

Q6. Std Variable and Fixed OH (50000+30000): $80,000 Std output: 1000 units Std rate per unit: $ 80 per unit Sdt cost allowed for actual output: 1200*80= 96000 Actual cocst incurred =52000+31000 = 83,000 Overhead spending Variance= Std cost per actual output- Actual overheads 96000 -83000 = 13000 F Q7. Std Qty allowed per unit:5 pounds Actual output: 1000 units Std qty allowed for actual output: 1000*5 = 5000 pounds Std price per pound: $ 20 per pound Std Material cost: 5000 pounds*20 = $ 100,000 Q8. Actual qty cocnsumed: 4800 lbs Actual price: 20 per pound Actual material cost: 4800 pounds*20 = 96,000 Std material cost: $ 100,000 Difference in Actual cost and std cost = 100,000 -96,000 = $ 4000 Favorable

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