2. Please check and fill the box where answers needed thanks. You have recently

Question

2. Please check and fill the box where answers needed thanks.

You have recently accepted a position with Vitex, Inc., the manufacturer of a popular consumer product. During your first week on the job, the vice president has been favorably impressed with your work. She has been so impressed, in fact, that yesterday she called you into her office and asked you to attend the executive committee meeting this morning for the purpose of leading a discussion on the variances reported for last period. Anxious to favorably impress the executive committee, you took the variances and supporting data home last night to study On your way to work this morning, the papers were laying on the seat of your new, red convertible. As you were crossing a bridge on the highway, a sudden gust of wind caught the the edge of the bridge and into the stream below. You managed to retrieve only one page, which contains the following information papers and blew them over Standard Cost Card Direct materials, 2.00 pounds at $16.50 per pound Direct labor, 1.00 direct labor-hours at $16.00 per direct labor-hour Variable manufacturing overhead, 1.00 direct labor-hours at $9.20 per direct labor-hour 33.00 $16.00 $ 9.20 Variances Re Direct materials Direct labor Variable manufacturing overhead Total Standard OS $627,000 $304,000 $174,800 Price or Rate $11,600F $4,000 U $4,500 F Quantity or Efficiency $33,000 U $16,000 U Applied to Work in Process during the period Entry obliterated You recall that manufacturing overhead cost is applied to production on the basis of direct labor-hours and that all of the materials purchased during the period were used in production. Work in process inventories are insignificant and can be ignored It is now 8:30 a.m. The executive committee meeting starts in just one hour, you realize that to avoid looking like a bungling fool you must somehow generate the necessary "backup data for the variances before the meeting begins. Without backup data it will be impossible to lead the discussion or answer any question:s

Explanation / Answer

1.

Units produced last year = Std. Cost applied for any input/ Std Cost per unit of that input = $ 627000/ 33 = 19000 units.

2.

Statement showing actual quantity of material is provided below:

Direct Material quantity Variance= "(Actual quantity - Standard quantity) xStandard Price

$ 33,000= {Actual quantity - 19000 units x 2 pounds} x $16.50

Actual Qty = 40000 pounds

3.

Direct Material price Variance= "(Actual price - Standard price) x Actual Qty

= - $ 11600 = (Actual price - $ 16) x 40000

Actual Price = $ 15.71

4.

Direct labour efficency variance = (Actual hours xStandard Rate) - Total Standard Cost

= $ 16000 = (Actual hours x $ 16) - $ 304000

Actual hours = 20000 hours

Due to time constrains an expert is allowed to answer initial 4 qts in case of mutli part qtns. I hope this will be helpful to you. Thanks

Statement showing actual quantity of material is provided below:

Related Questions

Navigate

• Browse (All)
• Browse 2
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.