Questions 34-45 are based on the following data: Pardoe, Inc., manufactures a pr
ID: 2544665 • Letter: Q
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Questions 34-45 are based on the following data: Pardoe, Inc., manufactures a product called Product A. The company uses a standard cost system and has established the following standards for one unit of Product A: Standard Quantity 1.5 pounds 0.6 hours 0.6 hours 0.6 hours Standard Price Direct Materials Direct labor Variable overhead Fixed overhead or Rate S3 per pound S6 per hour $1.25 per hour $1.75 per hour Standard Cost $4.50 3.60 75 105 9.90 During March 2016, the company produced 3,000 units and recorded the following: I. A total of 8,000 pounds of material were purchased at a cost of $23,000, II. III. IV. There was no beginning raw materials on hand to start the month; at the end of the month, 2,000 pounds of material remained in the warehouse unused. The company employs 10 people to work on the production of Product A. During March, each worked at an average of 160 hours at a rate of $6.50 per hour Variable overhead is assigned to Product A on the basis of direct labor-hours. Actual variable overhead costs during March totaled $1,800 and actual fixed overhead totaled $4,000. Budgeted fixed cost for March was $3,360. V. 34. The materials price variance for March is: a. $1,000 F b. $1,000 U. e. $750 F d. $750 U. 35. The materials quantity variance for March is: a. $4,500 F b. $10,500 F c. $10,500 U. d. S4,500 U. 36. The total material variance for March is: a. 5,500 F b. 9,500 F. c. 9,750 U d. 6,000 U. e. None of the above. 37. The labor rate variance for March is: a. $480 U. b. $800 U c. $480 F d. $800 FExplanation / Answer
34. Option C I.e, 750 F is right answer (3-2.875)×6,000.
35. Material quantity variance for March is $4,500 U I.e, option D is correct = (4,500-6,000)3.
36. Option E none of the above is the right answer because the sum of material price and material quantity variance will be the total material variance, which is not found in any option.
37.$800 U I.e, option B is correct = (6-6.50)160×10.
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