need help with 1 and 2 cach Flex Bud Var, for Op. Inc 531,040 F uct at a unit pr
ID: 2556671 • Letter: N
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need help with 1 and 2
cach Flex Bud Var, for Op. Inc 531,040 F uct at a unit price of $9.50. Actual sales for the year were 14,600 units at $12.00 Variable costs were budgeted at $2.00 per unit, and actual variable costs were $2.10 per buted Prepare Marshall's flexible budget performance report. What variance conti most to the year's favorable results? What caused this variance? arning Objecti E23-18 Defining the benefits of setting cost standards and calculating materials and labor variances Murry, Inc. produced 1,000 units of the company's product in 2018. The standard quantity of direct materials was three yards of cloth per unit at a standard cost of S1.35 per yard. The accounting records showed that 2,500 yards of cloth were used and the company paid $1.40 per yard. Standard time was two direct labor hours per unit at a standard rate of $10.00 per direct labor hour. Employees worked 1,700 hours and were paid $9.50 per hour Requirements 2. DM Eff Var $675 F 1. What are the benefits of setting cost standards? 2. Calculate the direct materials cost variance and the direct materials efficiency vari- ance as well as the direct labor cost and efficiency variances.Explanation / Answer
Req 1. The benefit of setting cost standard through maintaining budgets for various department is to have a constant check over the performances of all the department. Any variances from the planned budgets shall be instantly rectified by taking corrective actions. This is will also help in performance evaluation of the departments.
Req 2.
Std material qty per unit: 3yards Std price per yard: $ 1.35 per yard Std Quantity allowed (1000*3): 3000 yards Actual Qty used: 2500 yards Actual price per yard: $ 1.40 per yard Material price variance: Actual qty (Std price-Actual price) 2500 ( 1.35- 1.40) = $125 U Material Quantity variance: Std price (Std Qty-Actual Qty) 1.35 (3000-2500) = $675 F Material Cost variance: Std Qty*Std price - Actual Qty *Actual price (3000*1.35) - (2500*1.40) = 550 F Std Hour per unit: 2 hours Std hours alowed: 2000 hours Actual hours: 1700 hours Std rate per hour: $ 10 Actual rate per hour: $ 9.50 labuor rate variance: Actual hours (Std rate-Actual rate) 1700 (10-9.50) = 850 F Labour efficiency Variance = Std rate (Std hours-Actual Hours) 10.00 ( 2000-1700) = 3000 F Labour cost Variance: Std hours*Std rate - Actual Hours*Actual rate (2000*10) - (1700*9.50 ) = $ 3850 FRelated Questions
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