Question 1

The following company information is available:

The direct materials price variance is:

Accepted Answer

The answer of The following company information is available:

The...

Question 2

Bartels Corp. produces woodcarvings. It takes 2 hours of direct labor to produce a carving. Bartels' standard labor cost is $12 per hour. During August, Bartels produced 10,000 carvings and used 21,040 hours of direct labor at a total cost of $250,376. What is Bartels' labor efficiency variance for August?

Accepted Answer

The labor efficiency variance is calculated as (Actual hours - Standard hours) x Standard rate. Standard hours for 10,000 carvings = 10,000 x 2 = 20,000 hours. Actual hours = 21,040. Variance = (21,040 - 20,000) x $12 = $12,480 unfavorable.

Question 3

A company has established 5 pounds of Material M at $2 per pound as the standard for the material in its Product A. The company has just produced 1,000 units of this product, using 5,200 pounds of Material M that cost $9,880.
-The direct materials quantity variance is:

Accepted Answer

($2 x 5,200 pounds) - [$2 (1,000 units x 5 pounds)] = $400 unfavorable

Question 4

The following company information is available for January:

The direct material quantity variance is:

Accepted Answer

The answer of The following company information is available for...

Question 5

A job was budgeted to require 3 hours of labor per unit at $8.00 per hour. The job consisted of 8,000 units and was completed in 22,000 hours at a total labor cost of $198,000.
-What is the labor rate variance?

Accepted Answer

The answer of  A job was budgeted to require...

Question 6

Bradford Company budgeted 4,000 pounds of material costing $5.00 per pound to produce 2,000 units. The company actually used 4,500 pounds that cost $5.10 per pound to produce 2,000 units.
-What is the direct materials price variance?

Accepted Answer

4,500 pounds ($5 - $5.10) = $450 unfavorable

Question 7

Use the following data to find the direct labor efficiency variance.
$\begin{array}{ll}
\text { Direct labor standard (4 hrs. @ } & \$ 28 \text { per unit } \
\$ 7 / \mathrm{hr} \text {.) } & \
\text { Actual hours worked per unit } & 3.5 \text { hours } \
\text { Actual units produced } & 3,500 \text { units } \
\text { Actual rate per hour } & \$ 7.50
\end{array}$

Accepted Answer

The answer of Use the following data to find the...

Question 8

A company has established 5 pounds of Material M at $2 per pound as the standard for the material in its Product A. The company has just produced 1,000 units of this product, using 5,200 pounds of Material M that cost $9,880.
-The direct materials price variance is:

Accepted Answer

$9,880 - ($2 x 5,200 pounds) = $520 favorable

Question 9

The standard materials cost to produce one unit of Product M is 6 pounds of material at a standard price of $50 per pound. In manufacturing 8,000 units, 47,000 pounds of material were used at a cost of $51 per pound. What is the total direct material cost variance?

Accepted Answer

Price variance = $1 x 47,000 pounds = $47,000 unfavorable
Quantity variance = 1,000 pounds x $50 = $50,000 favorable
Total material cost variance = $3,000 favorable

Question 10

Bartels Corp. produces woodcarvings. It takes 2 hours of direct labor to produce a carving. Bartels' standard labor cost is $12 per hour. During August, Bartels produced 10,000 carvings and used 21,040 hours of direct labor at a total cost of $250,376. What is Bartels' labor rate variance for August?

Accepted Answer

Bartels' labor rate variance for August can be calculated using the formula: 
Labor rate variance = (Actual labor rate - Standard labor rate) x Actual hours worked

The actual labor rate is the total cost of direct labor divided by the actual hours worked:

Actual labor rate = $250,376 / 21,040 hours = $11.90 per hour

The standard labor rate is $12 per hour, as given in the problem.

Plugging in the numbers:

Labor rate variance = ($11.90 - $12) x 21,040 hours 
Labor rate variance = (-$0.10) x 21,040 hours 
Labor rate variance = -$2,104

Therefore, the labor rate variance for August is $2,104 favorable, as the actual labor rate is slightly lower than the standard labor rate.

Question 11

Bradford Company budgeted 4,000 pounds of material costing $5.00 per pound to produce 2,000 units. The company actually used 4,500 pounds that cost $5.10 per pound to produce 2,000 units.
-What is the direct materials quantity variance?

Accepted Answer

($5 x 4,500 pounds) - ($5 x [2,000 units x (4,000/2,000)]) = $2,500 unfavorable

Question 12

The following company information is available for January: The direct material price variance is:

Accepted Answer

The answer of The following company information is available for...

Question 13

A job was budgeted to require 3 hours of labor per unit at $8.00 per hour. The job consisted of 8,000 units and was completed in 22,000 hours at a total labor cost of $198,000.
-What is the total labor efficiency variance?

Accepted Answer

The answer of  A job was budgeted to require...

Question 14

The following company information is available:
$$\begin{array} { l l } 
\text { Direct materials used for production } & 712 \text { pounds } \
\text { Standard quantity for units produced } & 750 \text { pounds } \
\text { Standard cost per pound of direct material } & \$ 48 \
\text { Actual cost per pound of direct material } & \$ 50
\end{array}$$
 The direct materials quantity variance is:

Accepted Answer

The direct materials quantity variance is calculated as (Standard Quantity - Actual Quantity) x Standard Cost per Pound. Here, (750 - 712) x $48 = $1,824 favorable.

Question 15

The entry to record the labor costs and variances would include a:

Accepted Answer

Rate variance: $198,000 - (22,000 hours x $8) = $22,000 unfavorable
Debit to DL rate variance $22,000
Efficiency variance: ($8 x 22,000) - [$8 x (8,000 x 3 hours)] = $16,000 favorable
Credit to DL efficiency variance $16,000
Total labor cost: $198,000
Credit to factory payroll $198,000
Standard labor cost: ($8 x 3 hours) x 8,000 units = $192,000
Debit to GIP $192,000

Question 16

Use the following data to find the total direct labor cost variance.
$\begin{array}{ll}
\text { Direct labor standard (4 hrs. } @ & \$ 28 \text { per unit } \
\$ 7 / \mathrm{hr} \text {.) } & \
\text { Actual hours worked per unit } & 3.5 \text { hours } \
\text { Actual units produced } & 3,500 \text { units } \
\text { Actual rate per hour } & \$ 7.50
\end{array}$

Accepted Answer

The answer of Use the following data to find the...

Question 17

The following company information is available:

The direct materials quantity variance is:

Accepted Answer

The answer of The following company information is available:

The...

Question 18

Use the following data to find the direct labor rate variance.
$\begin{array}{ll}
\text { Direct labor standard (4 hrs. }@ & \$ 28 \text { per unit } \
\$ 7 / \text { hr.) } & \
\text { Actual hours worked per unit } & 3.5 \text { hours } \
\text { Actual units produced } & 3,500 \text { units } \
\text { Actual rate per hour } & \$ 7.50
\end{array}$

Accepted Answer

The direct labor rate variance is calculated as (Actual Rate - Standard Rate) x Actual Hours Worked. Here, it is ($7.50 - $7.00) x (3.5 hours/unit x 3,500 units) = $0.50 x 12,250 hours = $6,125 unfavorable.

Question 19

Bartels Corp. produces woodcarvings. It takes 2 hours of direct labor to produce a carving. Bartels' standard labor cost is $12 per hour. During August, Bartels produced 10,000 carvings and used 21,040 hours of direct labor at a total cost of $250,376. What is Bartels' labor cost variance for August?

Accepted Answer

The standard labor cost for 10,000 carvings should have been:

10,000 carvings x 2 hours per carving x $12 per hour = $240,000

The actual labor cost was $250,376.

Labor cost variance = actual labor cost - standard labor cost

Labor cost variance = $250,376 - $240,000 = $10,376 unfavorable.

Therefore, the correct answer is A, $10,376 unfavorable.

Question 20

A job was budgeted to require 3 hours of labor per unit at $8.00 per hour. The job consisted of 8,000 units and was completed in 22,000 hours at a total labor cost of $198,000.
-What is the total labor cost variance?

Accepted Answer

Rate variance: $198,000 - (22,000 hours x $8) = $22,000 unfavorable
Efficiency variance: ($8 x 22,000) - [$8 x (8,000 x 3 hours)] = $16,000 favorable
Total labor cost variance = $6,000 unfavorable

Quiz 21: Flexible Budgets and Standard Costing

The following company information is available: The direct materials price variance is:

A company has established 5 pounds of Material M at $2 per pound as the standard for the material in its Product A. The company has just produced 1,000 units of this product, using 5,200 pounds of Material M that cost $9,880. -The direct materials quantity variance is:

The following company information is available for January: The direct material quantity variance is:

A job was budgeted to require 3 hours of labor per unit at $8.00 per hour. The job consisted of 8,000 units and was completed in 22,000 hours at a total labor cost of $198,000. -What is the labor rate variance?

Bradford Company budgeted 4,000 pounds of material costing $5.00 per pound to produce 2,000 units. The company actually used 4,500 pounds that cost $5.10 per pound to produce 2,000 units. -What is the direct materials price variance?

A company has established 5 pounds of Material M at $2 per pound as the standard for the material in its Product A. The company has just produced 1,000 units of this product, using 5,200 pounds of Material M that cost $9,880. -The direct materials price variance is:

The standard materials cost to produce one unit of Product M is 6 pounds of material at a standard price of $50 per pound. In manufacturing 8,000 units, 47,000 pounds of material were used at a cost of $51 per pound. What is the total direct material cost variance?

Bradford Company budgeted 4,000 pounds of material costing $5.00 per pound to produce 2,000 units. The company actually used 4,500 pounds that cost $5.10 per pound to produce 2,000 units. -What is the direct materials quantity variance?

The following company information is available for January: The direct material price variance is:

A job was budgeted to require 3 hours of labor per unit at $8.00 per hour. The job consisted of 8,000 units and was completed in 22,000 hours at a total labor cost of $198,000. -What is the total labor efficiency variance?

The entry to record the labor costs and variances would include a:

The following company information is available: The direct materials quantity variance is:

A job was budgeted to require 3 hours of labor per unit at $8.00 per hour. The job consisted of 8,000 units and was completed in 22,000 hours at a total labor cost of $198,000. -What is the total labor cost variance?