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chapter 10 Standard Costs and the Balanced Scorecard

True/False 1. F Easy

Standard costs should by and large be based on the actual costs of prior periods.

2. F Easy

The criterion address labor pace should not include fringe benefits.

3. F Medium

From a point of view of monetary value control, the most effective fourth dimension to recognize substantial price variances is when the materials are placed into production.

4. F Medium

The material quantity variance is computed based on the quantity of all materials purchased during the period.

5. F Medium

Purchase of poor quality materials will generally result in a golden materials price variance and an unfavorable labor movement rate division.

6. T Easy

A balanced card is an integrate fit of performance measures that support management ‘s strategy throughout the organization.

7. F Medium

The performance measures on a balanced card tend to fall into four groups : fiscal measures, customer measures, home commercial enterprise process measures, and external commercial enterprise process measures.

8. T Easy

The emphasis in the balance card is on improvement rather than meeting a preset standard.

9. F Medium

A balance card should contain every performance measure that can be expected to influence a caller ‘s profits.

10. T Easy

Process Time is the only value-added component of Throughput Time.

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11. T Medium

( Appendix ) A favorable parturiency efficiency division would result in a credit libra in the undertaking efficiency variation account.

12. T Easy

Management by exception means that a director ‘s attention is directed toward those parts of the organization where things are not proceeding according to plans.

13. T Easy

The output director is normally held responsible for the undertaking efficiency discrepancy.

14. T Easy

Quantity standards indicate how much of an remark should be used for manufacturing a unit of product or in providing a unit of service.

15. F Easy

All cost variances should be considered exceptions that require the attention of management.

Multiple Choice 16. C Easy

The standards that allow for no machine breakdowns or other work interruptions and that require peak efficiency at all times are referred to as : a. normal standards. b. hardheaded standards. c. ideal standards. d. budgeted standards.

17. C Medium CPA adapted

To measure controllable production inefficiencies, which of the follow is the best basis for a company to use in establishing the standard hours allowed for the end product of one unit of measurement of product ? a. average historic performance for the death several years. b-complex vitamin. Engineering estimates based on ideal performance. c. Engineering estimates based on attainable performance. d. The hours per unit that would be required for the present work force to satisfy expected demand over the farseeing run.

18. C Easy CMA adapted

Which of the trace statements concerning virtual standards is incorrect ? a. practical standards can be used for product costing and cash budget. b. practical standards can be attained by the average worker. c. When virtual standards are used, there is no reason to adjust standards if an old car is replaced by a newer, faster machine. d. Under practical standards, large variances are less likely than under ideal standards.

19. B Easy CPA adapted

If a company follows a rehearse of isolating variances at the earliest period in prison term, what would be the appropriate time to isolate and recognize a calculate material price variance ? a. When material is issued. bacillus. When material is purchased. c. When material is used in production. d. When output is completed.

20. C Medium CPA adapted

An unfavorable labor efficiency division indicates that : a. The actual british labour party rate was higher than the standard labor pace. bel. The undertaking rate division must besides be unfavorable. c. actual parturiency hours worked exceed standard labor hours for the product level achieved. d. Overtime labor was used during the period.

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21. D Easy

A friendly labor rate discrepancy indicates that a. actual hours exceed standard hours. b. standard hours exceed actual hours. c. the actual rate exceeds the standard rate. d. the standard rate exceeds the actual rate.

22. B Hard CPA adapted

( Appendix ) What does a credit libra in a direct british labour party efficiency discrepancy history argue ? a. the average engage rate paid to direct labor employees was less than the standard rate. b. the standard hours allowed for the units produced were greater than actual steer labor hours used. c. actual entire target labor costs incurred were less than standard mastermind labor costs allowed for the units produced. d. the number of units produced was less than the phone number of units budgeted for the period.

23. C Easy

If the actual undertaking hours worked exceed the standard labor hours allowed, what type of division will occur ? a. friendly labor movement efficiency discrepancy. bel. friendly department of labor pace discrepancy. c. unfavorable tug efficiency variation. d. unfavorable labor movement rate discrepancy.

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24. A Medium CPA adapted

Which of the following is the most probable reason a ship’s company would experience an unfavorable labor rate discrepancy and a favorable labor efficiency discrepancy ? a. The blend of workers assigned to the particular job was heavily slant towards the consumption of higher pay, experience individuals. b. The mix of workers assigned to the finical speculate was heavy burden towards the consumption of newly relatively low paid, unskilled workers. c. Because of the production schedule, workers from other output areas were assigned to assist this particular summons. d. defective materials caused more tug to be used in order to produce a standard unit.

25. D Easy CPA adapted

Which department is normally held creditworthy for an unfavorable materials quantity variance ? a. marketing boron. Purchasing c. Engineering d. Production

26. B Easy CMA adapted

A friendly material price variation coupled with an unfavorable material custom variation would MOST likely result from : a. problems with processing machines. b. the leverage of low quality materials. c. problems with labor movement efficiency. d. changes in the product mix.

27. C Medium CMA adapted

Tower Company planned to produce 3,000 units of its single product, Titactium, during November. The standards for one unit of Titactium specify six pounds of materials at P0.30 per pound. actual production in November was 3,100 units of Titactium. There was a favorable materials price variance of P380 and an unfavorable materials measure discrepancy of P120. Based on these variances, one could conclude that : a. more materials were purchased than were used. b. more materials were used than were purchased. c. the actual cost per beat for materials was less than the standard cost per thump. d. the actual usage of materials was less than the standard allowed.

28. B Medium

A british labour party efficiency variability resulting from the use of poor quality materials should be charged to : a. the output coach. b. the buy agent. c. manufacturing overhead. d. the engineering department.

29. D Easy

Which of the follow represents value-added time in the fabrication cycle ? a. inspection time. b. queue time. c. Move time. d. march time.

30. D Medium

Throughput fourth dimension consists of : a. work time. bacillus. inspection prison term and move meter. c. Process time, inspection clock, and move prison term. d. Process fourth dimension, inspection time, move time, and queue time.

31. C Easy

Manufacturing Cycle Efficiency ( MCE ) is computed as : a. Throughput Time ÷ Delivery Cycle Time boron. action Time ÷ Delivery Cycle Time c. Value-Added Time ÷ Throughput Time d. Value-Added Time ÷ Delivery-Cycle Time

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32. D Medium

( Appendix ) Drake Company purchased materials on account. The entrance to record the leverage of materials having a standard cost of P1.50 per pound from a supplier at P1.60 per hammer would include a : a. credit to Raw Materials Inventory. b. debit to Work in Process. c. credit to Materials Price Variance. d. debit to Materials Price Variance.

33. A Medium

( Appendix ) Which of the trace entries would correctly record the charge of conduct labor costs to Work in Process given an unfavorable labor movement efficiency discrepancy and a favorable british labour party rate division ? a. bring in Process Labor Efficiency Variance Labor Rate Variance Wages Payable b. study in Process Wages Payable c. knead in Process Labor Efficiency Variance Labor Rate Variance Wages Payable d. work in Process Labor Rate Variance Labor Efficiency Variance Wages Payable

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34. C Easy CMA adapted

Under a standard cost system, the corporeal price variances are normally the duty of the : a. production coach. b. sales coach. c. buy director. d. technology director.

35. C Medium

The terms “ criterion quantity allowed ” or “ standard hours allowed ” mean : a. the actual output signal in units multiplied by the standard output signal allowed. b. the actual input in units multiplied by the standard output allowed. c. the actual output signal in units multiplied by the criterion remark allowed. d. the standard output in units multiplied by the standard input allowed.

36. D Medium CPA adapted

Dahl Company, a clothing manufacturer, uses a criterion cost system. Each unit of a finished product contains 2 yards of fabric. however, there is ineluctable waste of 20 %, calculated on input quantities, when the fabric is cut for forum. The cost of the fabric is P3 per cubic yard. The standard direct material monetary value for cloth per whole of end product is : a. P4.80. b. P6.00. c. P7.00. d. P7.50.

37. C Hard

Cox Company ‘s direct material costs for the month of January were as follows : actual measure purchased … … … …. 18,000 kilograms actual whole purchase price … … … … P 3.60 per kilogram Materials monetary value variance-unfavorable ( based on purchases ) …. P 3,600 Standard quantity allowed for actual production … … … … … 16,000 kilograms Actual quantity used … … … … … … 15,000 kilograms For January there was a friendly direct material quantity variance of : a. P3,360. b. P3,375. c. P3,400. d. P3,800.

38. C Hard

The Porter Company has a standard cost system. In July the company purchased and used 22,500 pounds of directly material at an actual cost of P53,000 ; the materials quantity variability was P1,875 Unfavorable ; and the standard measure of materials allowed for July product was 21,750 pounds. The materials price variance for July was : a. P2,725 F. b. P2,725 U. c. P3,250 F. d. P3,250 U.

39. C Medium CPA adapted

Information on Fleming Company ‘s direct material costs follows : actual sum of steer materials used … … 20,000 pounds actual send substantial costs … … … … …. P40,000 Standard price of calculate materials … … …. P2.10 per syrian pound Direct fabric efficiency division — favorable P3,000 What was the company ‘s direct material monetary value discrepancy ? a. P1,000 favorable. b. P1,000 unfavorable. c. P2,000 favorable. d. P2,000 unfavorable.

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40. C Easy

final month 75,000 pounds of direct material were purchased and 71,000 pounds were used. If the actual buy price per pound was P0.50 more than the standard purchase price per pound, then the material price variability was : a. P2,000 F. b. P37,500 F. c. P37,500 U. d. P35,500 U.

41. A Medium CPA adapted

During March, Younger Company ‘s directly material costs for intersection T were as follows : actual unit leverage price … … … … … P6.50 per meter Standard measure allowed for actual production … … … … … … … … … .. 2,100 meters Quantity purchased and used for actual production … … … … … … … … … .. 2,300 meters Standard unit price … … … … … … …. P6.25 per meter Younger ‘s material quantity variance for March was : a. P1,250 unfavorable. b. P1,250 favorable. c. P1,300 unfavorable. d. P1,300 favorable.

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42. B Easy

The adopt materials standards have been established for a particular intersection : standard quantity per unit of output signal .. 1.7 meters Standard price … … … … … … … … P19.80 per meter

The follow data pertain to operations concerning the merchandise for the survive calendar month : actual materials purchased … … … … 5,800 meters actual cost of materials purchased …. P113,680 Actual materials used in output … 5,100 meters actual output signal … … … … … … … …. 3,200 units What is the materials measure variance for the month ? a. P13,720 U b. P6,732 F c. P13,860 U d. P6,664 F 43. A easy

The play along materials standards have been established for a particular product : standard quantity per unit of output signal .. 8.3 grams Standard price … … … … … … … … P19.15 per gram The following data pertain to operations concerning the product for the concluding month : actual materials purchased … … … … 7,500 grams actual price of materials purchased …. P141,375 Actual materials used in production … 7,100 grams Actual output signal … … … … … … … …. 700 units What is the materials price variation for the calendar month ? a. P2,250 F b. P7,540 U c. P24,317 U d. P7,660 U

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44. C Hard CPA adapted

Information on Kennedy Company ‘s direct material costs follows : standard price per british pound of raw materials … …. P3.60 Actual quantity of raw materials purchased … … 1,600 pounds standard quantity allowed for actual production.. 1,450 pounds Materials purchase price division — favorable …. P 240 What was the actual leverage price per unit, rounded to the nearest penny ? a. P3.06. b. P3.11. c. P3.45. d. P3.75.

45. B Hard

The Fletcher Company uses standard cost. The keep up data are available for October : actual quantity of send materials used … 23,500 pounds standard price of aim materials … … … P2 per lebanese pound Material quantity variability … … … … … .. P1,000 friendly The criterion measure of material allowed for October product is : a. 23,000 pound. b-complex vitamin. 24,000 pound. c. 24,500 pound. d. 25,000 pound.

46. B Easy CPA adapted

Yola Company manufactures a product with standards for direct undertaking of 4 direct labor-hours per unit at a cost of P12.00 per aim labor-hour. During June, 1,000 units were produced using 4,100 hours at P12.20 per hour. The lineal undertaking efficiency variance was : a. P1,200 friendly. b. P1,200 unfavorable. c. P2,020 favorable. d. P2,020 unfavorable.

47. D Easy

The stick to parturiency standards have been established for a particular intersection : criterion department of labor hours per whole of output .. 8.3 hours Standard department of labor pace … … … … … … …. P12.10 per hour The pursuit datum refer to operations concerning the product for the last month : actual hours worked … … … … … … …. 6,100 hours Actual entire tug cost … … … … … … P71,370 Actual output … … … … … … … … …. 900 units What is the british labour party efficiency division for the month ? a. P19,017 F b. P19,017 U c. P16,029 F d. P16,577 F

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48. A easy

The watch undertaking standards have been established for a particular product : standard parturiency hours per unit of end product .. 1.7 hours Standard tug rate … … … … … … …. P14.05 per hour The surveil data pertain to operations concerning the intersection for the last calendar month : actual hours worked … … … … … … …. 3,700 hours Actual sum undertaking cost … … … … … … P50,690 Actual output … … … … … … … … …. 2,300 units What is the labor movement rate division for the calendar month ? a. P1,295 F b. P2,877 F c. P4,246 F d. P4,246 U

49. D Hard CPA adapted

Lab Corp. uses a standard price system. direct labor information for Product CER for the calendar month of October follows : Standard lead department of labor rate … … … … … .. P6.00 per hour Actual direct parturiency rate paid … … … … .. P6.10 per hour Standard hours allowed for actual production 1,500 hours Labor efficiency discrepancy — unfavorable … .. P600 What are the actual hours worked ? a. 1,400. b-complex vitamin. 1,402. c. 1,598. d. 1,600.

50. D Hard

The standards for direct department of labor for a product are 2.5 hours at P8 per hour. last calendar month, 9,000 units of the product were made and the labor efficiency variation was P8,000 F. The actual numeral of hours worked during the past time period was : a. 23,500. barn. 22,500. c. 20,500. d. 21,500.

51. C Hard

In a sealed standard costing system the follow results occurred last period : labor rate variance, P1,000 U ; department of labor efficiency division, P2,800 F ; and the actual labor movement pace was P0.20 more per hour than the standard parturiency pace. The number of actual direct labor hours used last time period was : a. 9,000. bacillus. 5,400. c. 5,000. d. 4,800.

52. A hard

The Reedy Company uses a standard costing system. The keep up data are available for November : actual aim british labour party hours worked … 5,800 hours Standard address undertaking rate … … … P9 per hour labor rate variance … … … … …. P1,160 golden The actual direct tug rate for November is : a. P8.80. b. P8.90. c. P9.00. d. P9.20.

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53. A hard CPA adapted

For the calendar month of April, Thorp Co. ‘s records disclosed the pursue data relating to target department of labor : actual cost … … … … … P10,000 Rate variation … … … …. P 1,000 golden efficiency variability … …. P 1,500 unfavorable For the month of April, actual direct department of labor hours amounted to 2,000. In April, Thorp ‘s standard direct labor rate per hour was : a. P5.50. b. P5.00. c. P4.75. d. P4.50.

54. B Hard

Borden Enterprises uses standard cost. For the month of April, the company reported the pursuit data : • Standard direct labor rate : P10 per hour • Standard hours allowed for actual production : 8,000 • actual direct parturiency rate : P9.50 per hour • Labor efficiency discrepancy : P4,800 F The labor rate variance for April is : a. P3,760 U. b. P3,760 F. c. P2,850 F. d. P2,850 U.

55. B Easy

The follow standards for variable manufacturing command processing overhead time have been established for a company that makes lone one product : standard hours per whole of output … … 7.8 hours Standard variable viewgraph rate … … .. P12.55 per hour The stick to datum pertain to operations for the last calendar month : actual hours … … … … … … … … … 2,900 hours actual total variable viewgraph cost …. P36,975 Actual output … … … … … … … … .. 200 units What is the variable overhead efficiency discrepancy for the calendar month ? a. P17,397 U b. P16,817 U c. P312 F d. P17,085 U

56. B Easy

The follow standards for variable manufacturing overhead have been established for a company that makes entirely one product : standard hours per unit of output … … 5.6 hours Standard variable overhead pace … … .. P12.00 per hour The follow datum refer to operations for the final calendar month : actual hours … … … … … … … … … 2,600 hours actual sum variable star overhead monetary value …. P31,330 Actual output … … … … … … … … .. 400 units What is the varying overhead spend discrepancy for the month ? a. P112 F b. P130 U c. P4,450 U d. P4,338 U

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Reference : 10-1 Bryan Company employs a criterion monetary value system in which direct materials inventory is carried at standard cost. Bryan has established the postdate standards for the flower costs of one unit of measurement of intersection : Standard Standard Standard Quantity Price Cost Direct materials …. 6 pounds P 3.50/pound P21.00 Direct undertaking … … .. 1.3 hours P11.00/hour 14.30 P35.30 During March, Bryan purchased 165,000 pounds of send material at a sum cost of P585,750. The total factory wages for March were P400,000, 90 percentage of which were for direct labor movement. Bryan manufactured 25,000 units of merchandise during March using 151,000 pounds of direct material and 32,000 lineal tug hours. 57. B Medium Refer To : 10-1

The monetary value variance for the address material acquired by the company during March is : a. P7,550 favorable. b. P8,250 unfavorable. c. P7,550 unfavorable. d. P8,250 favorable.

58. A medium refer To : 10-1

The send material quantity variation for March is : a. P3,500 unfavorable. b. P3,550 favorable. c. P3,500 friendly. d. P3,550 unfavorable.

59. C Medium Refer To : 10-1

The direct labor rate discrepancy for March is : a. P 8,000 favorable. b. P48,000 unfavorable. c. P 8,000 unfavorable. d. P48,000 favorable.

60. B Medium Refer To : 10-1

The direct labor efficiency discrepancy for March is : a. P5,625 unfavorable. b. P5,500 golden. c. P5,625 golden. d. P5,500 unfavorable.

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Reference : 10-2 The Litton Company has established standards as follows : directly substantial 3 pound. @ P4/lb. = P12 per unit Direct labor 2 hour. @ P8/hr. = P16 per unit of measurement variable manuf. operating expense 2 hour. @ P5/hr. = P10 per unit of measurement actual production figures for the past year are given below. The company records the materials price variance when materials are purchased. Units produced 600 Direct material used 2,000 pound. direct fabric purchased ( 3,000 pound. ) P11,400 Direct department of labor cost ( 1,100 hour. ) P 9,240 variable star manuf. command processing overhead time cost incurred P 5,720 The caller applies variable star manufacturing overhead to products on the basis of send tug hours. 61. C Easy Refer To : 10-2

The materials price variance is : a. P400 U. b. P400 F. c. P600 F. d. P600 U.

62. A easy Refer To : 10-2

The materials quantity division is : a. P800 U. b. P4,000 U. c. P760 U. d. P760 F.

63. D Easy Refer To : 10-2

The labor movement rate variability is : a. P480 F. b. P480 U. c. P440 F. d. P440 U.

64. A easy Refer To : 10-2

The tug efficiency variation is : a. P800 F. b. P800 U. c. P840 F. d. P840 U.

65. B Easy Refer To : 10-2

The variable disk overhead spend variance is : a. P240 U. b. P220 U. c. P220 F. d. P240 F.

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66. D Easy Refer To : 10-2

The variable overhead efficiency variance is : a. P520 F. b. P520 U. c. P500 U. d. P500 F.

reference point : 10-3 The Albright Company uses standard cost and has established the follow standards for its single intersection : steer materials … … …. 2 gallons at P3 per gallon Direct labor … … … … .. 0.5 hours at P8 per hour variable manuf. command processing overhead time .. 0.5 hours at P2 per hour During November, the company made 4,000 units and incurred the succeed costs : lead materials purchased … … .. 8,100 gallons at P3.10 per gallon Direct materials used … … … …. 7,600 gallons lead labor used … … … … … .. 2,200 hours at P8.25 per hour Actual varying manuf. overhead … P4,175 The ship’s company applies variable star manufacturing overhead to products on the footing of conduct labor hours. 67. C Easy Refer To : 10-3

The material price discrepancy for November was : a. P2,310 U. b. P2,310 F. c. P810 U. d. P810 F.

68. B Easy Refer To : 10-3

The substantial measure variability for November was : a. P1,200 U. b. P1,200 F. c. P300 U. d. P1,500 F.

69. B Easy Refer To : 10-3

The undertaking rate variance for November was : a. P1,050 U. b. P550 U. c. P2,150 U. d. P2,150 F.

70. D Easy Refer To : 10-3

The labor efficiency discrepancy for November was : a. P1,050 U. b. P550 U. c. P1,600 F. d. P1,600 U.

71. A metier refer To : 10-3

The sum variable star overhead discrepancy for November was : a. P175 U. b. P225 F. c. P225 U. d. P400 U.

reference point : 10-4 Cole laboratories makes and sells a lawn fertilizer called Fastgro. The company has developed standard costs for one base of Fastgro as follows : standard Standard Quantity Cost per Bag Direct corporeal … … … .. 20 pounds P8.00

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Direct labor … … … … .. 0.1 hours variable manuf. overhead .. 0.1 hours

1.10 .40

The party had no beginning inventories of any kind on Jan. 1. variable manufacturing overhead is applied to product on the basis of send department of labor hours. During January, the follow natural process was recorded by the company : • production of Fastgro : 4,000 bags • direct materials purchased : 85,000 pounds at a cost of P32,300 • Direct labor worked : 390 hours at a price of P4,875 • Variable manufacturing command processing overhead time incurred : P1,475 • Inventory of mastermind materials on Jan. 31 : 3,000 pounds 72. C Medium Refer To : 10-4

The materials price variance for January is : a. P1,640 F. b. P1,640 U. c. P1,700 F. d. P1,300 U.

73. A medium refer To : 10-4

The materials quantity variance for January is : a. P800 U. b. P300 U. c. P300 F. d. P750 F.

74. D Medium Refer To : 10-4

The labor rate discrepancy for January is : a. P475 F. b. P475 U. c. P585 F. d. P585 U.

75. D Medium Refer To : 10-4

The labor efficiency variation for January is : a. P475 F. b. P350 U. c. P130 U. d. P110 F.

76. D Medium Refer To : 10-4

The sum variability for variable command processing overhead time for January is : a. P85 F. b. P40 F. c. P100 U. d. P125 F.

reference : 10-5 ( Appendix ) The Dexon Company makes and sells a one product called a Mip and employs a standard cost system. The pursue standards have been established for one unit of Mip : Standard Quantity Standard Cost or Hours per Mip Direct materials .. 6 display panel feet P9.00 Direct labor movement … … 0.8 hours P9.60 There were no inventories of any kind on August 1. During August, the watch events occurred : • Purchased 15,000 dining table feet at the entire cost of P24,000. • Used 12,000 control panel feet to produce 2,100 Mips. • Used 1,700 hours of send labor time at a sum cost of P20,060.

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77. B Medium Refer To : 10-5

To record the purchase of mastermind materials, the general ledger would include what entrance to the Materials Price Variance Account ? a. P1,500 credit b. P1,500 debit c. P6,000 credit d. P6,000 debit

78. D Medium Refer To : 10-5

To record the habit of direct materials in production, the cosmopolitan ledger would include what entrance to the Materials Quantity Variance bill ? a. P3,600 debit b. P3,600 credit. c. P900 debit d. P900 credit

79. D Medium Refer To : 10-5

To record the incurrence of send parturiency cost and its use in production, the general ledger would include what entry to the Labor Rate Variance account ? a. P240 credit b. P240 debit c. P340 debit d. P340 recognition

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80. B Medium Refer To : 10-5

To record the incurrence of steer parturiency costs and its use in production, the general ledger would include what entry to the Labor Efficiency Variance account ? a. P480 recognition b. P240 debit c. P1,200 debit d. P1,200 citation

Reference : 10-6 The Alpha Company produces toys for national distribution. Standards for a especial miniature are : Materials : 12 ounces per unit of measurement at 56¢ per snow leopard. labor movement : 2 hours per unit at P2.75 per hour. During the month of December, the company produced 1,000 units. information for the calendar month follows : Materials : 14,000 ounces were purchased and used at a total cost of P7,140. parturiency : 2,500 hours worked at a total cost of P8,000. 81. D Easy Refer To : 10-6

The materials price variance is : a. P700 U. b. P420 U. c. P420 F. d. P700 F.

82. A easy Refer To : 10-6

The materials quantity variance is : a. P1,120 U. b. P1,820 F. c. P1,820 U. d. P1,120 F.

83. C Easy Refer To : 10-6

The british labour party rate variation is : a. P2,500 F. b. P1,125 F. c. P1,125 U. d. P2,500 U.

84. B Easy Refer To : 10-6

The british labour party efficiency discrepancy is : a. P1,600 U. b. P1,375 U. c. P1,375 F. d. P1,600 F.

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Reference : 10-7 The keep up materials standards have been established for a particular product : standard quantity per unit of output signal .. 4.4 pounds standard monetary value … … … … … … … … P13.20 per pound The pursuit data refer to operations concerning the merchandise for the last month : actual materials purchased … … … … 4,800 pounds actual price of materials purchased …. P62,880 Actual materials used in production … 4,300 pounds actual output … … … … … … … …. 700 units 85. A easy Refer To : 10-7

What is the materials monetary value variation for the month ? a. P480 F b. P430 F c. P430 U d. P480 U

86. C Easy Refer To : 10-7

What is the materials quantity variance for the month ? a. P6,550 U b. P15,982 U c. P16,104 U d. P6,600 U

Reference : 10-8 The come materials standards have been established for a particular product : standard quantity per unit of output .. 1.9 grams Standard price … … … … … … … … P18.00 per gram The following data refer to operations concerning the product for the last month : actual materials purchased … … … … 5,800 grams actual cost of materials purchased …. P108,460 Actual materials used in product … 5,200 grams Actual output signal … … … … … … … …. 2,700 units 87. A easy Refer To : 10-8

What is the materials monetary value variability for the calendar month ? a. P4,060 U b. P3,640 F c. P3,640 U d. P4,060 F

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88. A easily Refer To : 10-8

What is the materials quantity discrepancy for the month ? a. P1,260 U b. P1,309 U c. P11,220 U d. P10,800 U

Reference : 10-9 The watch materials standards have been established for a particular product : criterion quantity per unit of output signal .. 6.8 meters Standard price … … … … … … … … P17.10 per meter The following data refer to operations concerning the intersection for the end month : actual materials purchased … … … … 9,000 meters actual cost of materials purchased …. P156,600 actual materials used in production … 8,500 meters actual output … … … … … … … …. 1,200 units 89. D Easy Refer To : 10-9 90. A easy Refer To : 10-9

What is the materials price variability for the calendar month ? a. P2,700 F b. P2,550 U c. P2,550 F d. P2,700 U What is the materials quantity discrepancy for the calendar month ? a. P5,814 U b. P8,700 U c. P5,916 U d. P8,550 U

Reference : 10-10 The following labor standards have been established for a particular intersection : standard department of labor hours per unit of end product .. 7.5 hours Standard department of labor rate … … … … … … …. P15.25 per hour The take after datum refer to operations concerning the product for the stopping point calendar month : actual hours worked … … … … … … …. 9,600 hours Actual total parturiency cost … … … … … … P144,480 Actual end product … … … … … … … … …. 1,200 units

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91. A easy Refer To : 10-10 92. D Easy Refer To : 10-10

What is the labor rate variability for the month ? a. P1,920 F b. P240 U c. P1,920 U d. P240 F What is the labor movement efficiency variance for the calendar month ? a. P7,230 U b. P9,030 U c. P7,230 F d. P9,150 U

Reference : 10-11 The Clark Company makes a single product and uses criterion cost. Some data concerning this intersection for the calendar month of May follow : labor pace variance : … … … … … … … … … … …. P 7,000 F Labor efficiency discrepancy : … … … … … … … … …. P12,000 F Variable disk overhead efficiency discrepancy : … … … … …. P 4,000 F Number of units produced : … … … … … … … … … .. 10,000 Standard british labour party pace per target labor hour : … … … … P12 Standard varying overhead rate per aim labor movement hour : p 4 Actual labor hours used : … … … … … … … … … … 14,000 Actual variable fabrication overhead costs : … … … P58,290 93. B Medium Refer To : 10-11 94. D Hard Refer To : 10-11 95. B Hard Refer To : 10-11 96. C Hard Refer To : 10-11 97. C Hard Refer To : 10-11

The variable star viewgraph spend variability for May was : a. P2,290 F. b. P2,290 U. c. P1,710 F. d. P1,710 U. The actual direct labor rate for May in Pesos per hour was : a. P12.50. b. P12.00. c. P11.75. d. P11.50. The total standard cost for direct british labour party for May was : a. P168,000. b. P180,000. c. P120,000. d. P161,000. The full criterion monetary value for variable viewgraph for May was : a. P56,000. b. P40,000. c. P60,000. d. P50,000. The standard hours allowed to make one unit of finished merchandise are : a. 1.0. bacillus. 1.2. c. 1.5. d. 2.0.

reference point : 10-12 The keep up standards for variable manufacturing overhead have been established for a company that makes only one product : standard hours per unit of output … … 1.6 hours Standard variable overhead rate … … .. P11.55 per hour The adopt datum refer to operations for the last calendar month : actual hours … … … … … … … … … 4,900 hours actual full varying viewgraph cost …. P58,310 Actual end product … … … … … … … … .. 3,000 units

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98. C Hard Refer To : 10-11 99. C Easy Refer To : 10-12

What is the variable command processing overhead time spend variability for the month ? a. P2,870 U b. P2,870 F c. P1,715 U d. P1,715 F What is the variable overhead efficiency variation for the calendar month ? a. P1,680 F b. P1,190 U c. P1,155 U d. P1,190 F

Reference : 10-13 The Upton Company employs a standard cost system in which variable star command processing overhead time is assigned to production on the footing of direct department of labor hours. Data for the month of February include the follow : • Variable manufacture overhead monetary value incurred : P48,700 • Total variable overhead variance : P300 F • Standard hours allowed for actual output : 7,000 • actual direct tug hours worked : 6,840 100. C Hard Refer To : 10-13

The standard variable disk overhead rate per direct undertaking hour is : a. P6.91. b. P6.95. c. P7.00. d. P7.12.

123Managerial Accounting, 9/e

101. B Hard Refer To : 10-13 102. C Hard Refer To : 10-13

The variable disk overhead spend variance is : a. P820 F. b. P820 U. c. P740 F. d. P740 U. The variable command processing overhead time efficiency variance is : a. P430 U. b. P740 F. c. P1,120 F. d. P950 U.

character : 10-14 Ricric Corporation has provided the follow datum for one of its products : process time … … .. 3 days Queue time … … …. 4 days Inspection time … .. 0.7 days Move time … … … .. 0.3 days Wait clock time … … … .. 9 days 103. A easy Refer To : 10-14 104. B Easy Refer To : 10-14 105. A medium refer To : 10-14

The throughput time for this operation would be : a. 8 days. b. 3 days. c. 17 days. d. 7.7 days. The delivery cycle time for this operation would be : a. 8 days. b. 17 days. c. 9.3 days. d. 7.7 days. The manufacture cycle efficiency for this operation would be closest to : a. 0.375. bacillus. 0.45. c. 0.18. d. 0.33.

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Essay 106. Hard

( Appendix ) Albert Manufacturing Company manufactures a single product. The standard cost of one whole of this product is : direct materials : 6 feet at P1.50 … … … .. P 9.00 Direct labor : 1 hour at P6.75 … … … … … 6.75 variable star overhead : 1 hour at P4.50 … … …. 4.50 sum standard variable price per whole … …. P20.25 During the month of October, 6,000 units were produced. Selected monetary value data relating to the month ‘s production follow : substantial purchased : 60,000 feet at P1.43 …. P85,800 Material used in production : 38,000 feet … Direct labor : ? __ hours at P ? __ per hour .. P41,925 Variable overhead cost incurred … … … …. P30,713 Variable overhead efficiency discrepancy … …. P 2,250 There was no beginning inventory of raw materials. The variable operating expense rate is based on mastermind laborhours. Required : a. For directly materials, compute the price and quantity variances for the calendar month, and prepare daybook entries to record action for the calendar month. bacillus. For send tug, compute the pace and efficiency variances for the calendar month, and prepare a daybook entrance to record labor natural process for the month. c. For variable command processing overhead time, compute the spend division for the calendar month, and prove the efficiency variance given above.

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Answer : a. Materials Price variation : actual Quantity of Inputs, at actual price : 60,000 feet @ P1.43 per animal foot … … … … P85,800 Actual Quantity of Inputs, at Standard Price : 60,000 feet @ P1.50 … … … … … … … 90,000 Materials Price variance … … … … … … P 4,200 F Materials Quantity Variance : actual Quantity of Inputs, at Standard Price : 38,000 feet @ P1.50 per foundation … … … … P57,000 Standard Quantity of Inputs, at Standard Price : 6,000 units @ 6 feet per unit of measurement adam P1.50 per foot 54,000 Materials Quantity Variance … … … … … P 3,000 U Journal entries : raw Materials ( 60,000 feet @ P1.50 ) … …. 90,000 Materials Price Variance ( 60,000 feet @ P.07 F ) … … … … …. 4,200 Accounts collectible ( 60,000 feet @ P1.43 ) .. 85,800 Work in Process ( 36,000 feet @ P1.50 ) … .. 54,000 Materials Quantity Variance ( 2,000 feet U @ P1.50 ) … … … … …. 3,000 raw Materials ( 38,000 feet @ P1.50 ) … .. 57,000 barn. The actual hours worked during the period can be computed efficiency variation, as follows :

through the variable overhead

SR ( AH – SH ) = variable Overhead Efficiency Variance P4.50 ( AH – ( 6,000 units @ 1 hour. per unit ) = P2,250 U P4.50AH – P27,000 = P2,250 U P4.50AH = P29,250 AH = 6,500 hours Labor Rate Variance : actual Hours of Input, at the actual rate : 6,500 hours @ P6.45 … … … … … … .. P49,056 Actual Hours of Input, at the Standard Rate : 6,500 hours @ P6.75 per hour … … … .. 43,875 Labor Rate Variance … … … … … … …. P 1,950 F Labor Efficiency Variance : actual Hours of Input, at the Standard Rate : 6,500 hours @ P6.75 per hour … … … .. P43,875 Standard Hours of Input, at the Standard Rate : 6,000 @ 1 hour per unit @ P6.75 per hour 40,500 Labor Efficiency Variance … … … … …. P 3,375 U Journal introduction : work in Process ( 6,00 hours @ P6.75 ) … .. 40,500 Labor Efficiency Variance ( 500 hour. U @ P6.75 ) 3,696 Labor Rate Variance ( 6,500 hour. @ P0.30 F ) 6,480 Wages Payable ( 6,500 hour. @ P6.45 ) … .. 41,925

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c. Variable Overhead Spending division : actual Hours of Input, at the Actual Rate P30,713 Actual Hours of Input, at the Standard Rate : 6,500 hours @ P4.50 per hour … … … .. 29,250 variable overhead spend variability … … P 1,463 U Variable Overhead Efficiency Variance : actual Hours of Input, at the Standard Rate : 6,500 hours @ P4.50 per hour … … … .. P 29,250 Standard Hours of Input, at the Standard Rate : 6,000 hours @ P4.50 per hour … … … .. 27,000 Labor Efficiency Variance … … … … …. P 2,250 U 107. Hard

( Appendix ) Vernon Mills, Inc. is a big producer of men ‘s and women ‘s clothing. The company uses standard costs for all of its products. The standard costs and actual costs per unit of product for a late period are given below for one of the company ‘s product lines : Standard Actual Cost Cost Standard : 4.0 yards at P5.40 per yard … … P21.60 Actual : 4.4 yards at P5.05 per yard … … … P22.22 Direct labor : standard : 1.6 hours at P6.75 per hour … …. P10.80 Actual : 1.4 hours at P7.30 per hour … … … P10.22 Variable disk overhead : standard : 1.6 hours at P2.70 per hour … …. P 4.32 Actual : 1.4 hours at P3.25 per hour … … … P 4.55 sum price per unit of measurement … … … … … … … .. P36.72 P36.99

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During this period, the company produced 4,800 units of this product. A comparison of standard and actual costs for the period on a sum monetary value basis is given below : actual costs : 4,800 units at P36.99 … … P177,552 Standard costs : 4,800 units at P36.72 …. 176,256 difference in monetary value — unfavorable … … …. P 1,296 There was no inventory of materials on bridge player at the begin of the period. During the period, 21,120 yards of materials were purchased, all of which were used in production. Required : a. For conduct materials, compute the price and measure variances for the period and prepare daybook entries to record all action relating to address materials for the menstruation. b. For direct undertaking, compute the rate and efficiency variances and prepare a diary submission to record the incurrence of direct undertaking cost for the period. c. For variable overhead, compute the spend and efficiency variances. answer : a. Materials Price variability : actual Quantity of Inputs, at actual price : 4,800 units, 4.4 yards per unit, P5.05 per yard = P106,656 Actual Quantity of Inputs, at Standard Price : 4,800 units, 4.4 yards per unit, P5.40 per yard = 114,048 Materials Price Variance … … … … … … …. P 7,392 F Materials Quantity Variance : actual Quantity of Inputs, at Standard Price : 4,800 units, 4.4 yards per unit, P5.40 per thousand = P114,048 Standard Quantity of Inputs, at Standard Price : 4,800 units, 4.0 yards per whole, P5.40 per yard = 103,680 Materials Quantity Variance … … … … … …. P 10,368 U Journal entries : raw Materials ( 21,120 yards @ P5.40 ) … … …. 114,048 Materials Price Variance ( 21,120 yards @ P0.35 F ) … … … … … … 7,392 Accounts collectible ( 21,120 yards @ P5.05 ) … .. 106,656 Work in Process ( 19,200 yards @ P5.40 ) … … .. 103,680 Materials Quantity Variance ( 1,920 yards @ P5.40 ) 10,368 raw Materials ( 21,120 yards @ P5.40 ) … … .. 114,048

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boron. Labor Rate Variance : actual Hours of Input, at the actual rate : 4,800 units, 1.4 hours, P7.30 per hour … … P49,056 Actual Hours of Input, at the Standard Rate : 4,800 units, 1.4 hours, P6.75 per hour … … 45,360 Labor Rate Variance … … … … … … … … … P 3,696 U Labor Efficiency Variance : actual Hours of Input, at the Standard Rate : 4,800 units, 1.4 hours, P6.75 per hour … … P45,360 Standard Hours of Input, at the Standard Rate : 4,800 units, 1.6 hours, P6.75 per hour … … 51,840 Labor Efficiency Variance … … … … … … … P 6,480 F Journal submission : bring in Process ( 7,600 hours @ P6.75 ) … … … 51,840 Labor Rate Variance ( 6,720 @ P0.55 U ) … … … 3,696 Labor Efficiency Variance ( 960 hour. F @ P6.75 ) 6,480 Wages Payable ( 6,720 hour. @ P7.30 ) … … …. 49,056 c. Variable Overhead Spending variance : actual Hours of Input, at the actual rate : 4,800 units, 1.4 hours, P3.25 per hour … … P 21,840 Actual Hours of Input, at the Standard Rate : 4,800 units, 1.4 hours, P2.70 per hour … … 18,144 variable operating expense outgo discrepancy … … … .. P 3,696 U Variable Overhead Efficiency Variance : actual Hours of Input, at the Standard Rate : 4,800 units, 1.4 hours, P2.70 per hour … … P 18,144 Standard Hours of Input, at the Standard Rate : 4,800 units, 1.6 hours, P2.70 per hour … … 20,736 Labor Efficiency Variance … … … … … … … P 2,592 F 108. medium

Lido Company ’ s standard and actual costs per unit for the most holocene menstruation, during which 400 units were actually produced, are given below : Standard Actual Materials : standard : 2 ft. at P1.50 per ft. … … .. P 3.00 Actual : 2.1 ft. at P1.60 per ft. … … .. P 3.36 Direct labor : standard : 1.5 hour. at P6.00 per hour. … .. 9.00 actual : 1.4 hour. at P6.50 per hour. … …. 9.10 variable command processing overhead time : standard : 1.5 hour. at P3.40 per hour. … .. 5.10 actual : 1.4 hour. at P3.10 per hour. … …. 4.34 sum unit cost … … … … … … … … …. P17.10 P16.80 Required : From the foregoing information, compute the take after variances. Show whether the variance is friendly ( F ) or unfavorable ( U ) : a. material price variance boron. Material quantity discrepancy c. Direct labor movement rate discrepancy d. Direct labor efficiency variation e. Variable overhead outgo discrepancy f. Variable overhead efficiency division

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Answer : a. material price discrepancy = AQ ( AP-SP ) = ( 2.1×400 ) ten ( P1.60-P1.50 ) = P84 U b. Material measure variation = SP ( AQ-SQ ) = P1.50 ( 2.1×400 – 2.0×400 ) = P60 U c. Direct department of labor rate discrepancy = AH ( AR-SR ) = ( 1.4×400 ) x ( P6.50-P6.00 ) = P280 U d. Direct undertaking efficiency variance = SR ( AH-SH ) = P6.00 ( 1.4×400 – 1.5×400 ) = P240 F e. varying overhead spend variability = AH ( AR-SR ) = ( 1.4×400 ) adam ( P3.10-P3.40 ) = P168 F f. Variable command processing overhead time efficiency variation = SR ( AH-SH ) = P3.40 ( 1.4×400 – 1.5×400 ) = P136 F 109. medium

( Appendix ) The Lahn Company produces and sells a single product. Standards have been established for the product as follows : direct materials … 5 pound. @ P3.50/lb. = P17.50/unit Direct labor … …. 3 hour. @ P5.50/hr. = P16.50/unit Actual cost and usage figures for the past calendar month keep up : Units produced … … … … … .. 750 calculate materials used … … …. 4,000 pound. send materials purchased … .. P14,400 ( 4,500 pound. ) Direct labor cost … … … … .. P11,200 ( 2,000 hour. )

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Required : Prepare journal entries to read : a. The buy of raw materials. bel. The custom of natural materials in production. c. The incurrence of direct undertaking cost. answer : a. raw materials inventory … … … … … .. 15,750* Materials price variance … … … … .. 1,350** Accounts collectible … … … … … … …. 14,400 * P3.50 per pound. x 4,500 pound. = P15,750 ** AQ ( AP – SP ) = 4,500 ( ( P14,400/4,500 pound ) – P3.50 ) = P1,350 F bel. influence in process … … … … … … … …. 13,125* Materials quantity discrepancy … … … …. 875** raw materials inventory … … … … … 14,000*** * P3.50 per pound. x 5 pound per unit of measurement ten 750 units = P13,125 ** SP ( AQ – SQ ) = P3.50 ( 4,000 – ( 5 adam 750 ) ) = P875 U *** P3.50 x 4,000 = P14,000 c. Work in summons … … … … … … … …. 12,375* Labor rate discrepancy … … … … … … … 200** Labor efficiency variance … … … …. 1,375*** accrue wages collectible … … … … … .. 11,200 * P5.50 per hour. x 3 hour per unit ten 750 units = P12,375 ** AH ( AR – strontium ) = 2,000 ( ( P11,200/2,000 ) – P5.50 ) = P200 U *** SR ( AH – SH ) = P5.50 ( 2,000 – ( 3 ten 750 ) ) = P1,375 F 110. slowly

The following materials standards have been established for a particular product : standard quantity per unit of output signal .. 9.2 grams Standard price … … … … … … … … P14.70 per gram The following data pertain to operations concerning the intersection for the end month : actual materials purchased … … … … 5,500 grams actual price of materials purchased …. P76,450 Actual materials used in production … 5,100 grams Actual output … … … … … … … …. 540 units Required : a. What is the materials price discrepancy for the calendar month ? b. What is the materials measure variance for the month ?

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Answer : solution : Materials price variance = ( AQ x AP ) – ( AQ x SP ) = P76,450 – ( 5,500 x P14.70 ) = P4,400 F SQ = Standard quantity per unit x Actual end product = 9.2 ten 540 = 4,968 Materials quantity variability = SP ( AQ – SQ ) = P14.70 ( 5,100 – 4,968 ) = P1,940 U 111. easy

The play along materials standards have been established for a particular product : criterion quantity per unit of end product .. 9.4 pounds standard price … … … … … … … … P16.90 per impound The succeed datum pertain to operations concerning the product for the death month : actual materials purchased … … … … 7,300 pounds actual monetary value of materials purchased …. P116,435 Actual materials used in production … 7,100 pounds actual output … … … … … … … …. 740 units Required : a. What is the materials price variation for the calendar month ? b-complex vitamin. What is the materials measure variance for the month ? answer : Materials monetary value discrepancy = ( AQ x AP ) – ( AQ x SP ) = P116,435 – ( 7,300 x P16.90 ) = P6,935 F SQ = Standard measure per unit of measurement x Actual output = 9.4 ten 740 = 6,956 Materials quantity division = SP ( AQ – SQ ) = P16.90 ( 7,100 – 6,956 ) = P2,434 U

112. easy

The keep up materials standards have been established for a particular product : standard measure per unit of end product .. 3.6 feet standard price … … … … … … … … P10.20 per feet The following data pertain to operations concerning the product for the stopping point calendar month : actual materials purchased … … … … 7,100 feet actual price of materials purchased …. P68,515 Actual materials used in production … 6,600 feet actual end product … … … … … … … …. 1,780 units

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Required : a. What is the materials price discrepancy for the calendar month ? barn. What is the materials quantity variance for the month ? suffice : Materials price variance = ( AQ x AP ) – ( AQ x SP ) = P68,515 – ( 7,100 x P10.20 ) = P3,905 F SQ = Standard quantity per unit of measurement x Actual output = 3.6 ten 1,780 = 6,408 Materials quantity variation = SP ( AQ – SQ ) = P10.20 ( 6,600 – 6,408 ) = P1,958 U 113. Hard

Dodge Company produces a single intersection. The company has set the follow standards for materials and labor : address Materials Direct Labor Standard quantity or hours per whole ? pounds 3 hours Standard price or rate … … … … ? per beat P15 per hour Standard cost per whole … … … … ? P45 During the by month, the caller purchased 7,000 pounds of direct materials at a cost of P26,250. All of this material was used in the production of 1,300 units of intersection. aim british labour party cost totaled P55,125 for the calendar month. The keep up variances have been computed : Materials price variance … …. P1,750 F Total materials discrepancy … …. P250 U Labor efficiency variance … … P6,000 F Required : a. For mastermind materials, compute the standard price per pound, the standard quantity allowed for materials in full for the calendar month ‘s production, and the standard quantity per whole of product. bel. For direct undertaking, compute the actual direct parturiency price per hour for the calendar month and the labor rate variation. solution : a. The actual cost of material per pound for the calendar month was : P26,500  7,000 pounds = P3.75 per pound. AQ ( AP – SP ) = Materials Price Variance 7,000 pounds ( P3.75 – SP ) = P1,750 F P26,250 – 7,000 SP = P1,750 F 7,000 SP = P28,000 SP = P4.00 SP ( AQ – SQ ) = Materials Quantity Variance P4.00 ( 7,000 pound. – SQ ) = P2,000 U P28,000 – P4.00 SQ = P2,000 U P4.00 SQ = P26,000 SQ = 6,500 pound. 6,500 pound.  1,300 units = 5 pound. per unit of measurement.

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b. SR ( AH – SH ) = Labor Efficiency Variance P15 ( AH – ( ( 1,300 units x 3 hours ) ) = P6,000 F P15 AH – P58,500 = P6,000 F P15 AH = P52,500 AH = 3,500 hours consequently, P55,125 total actual labor cost  3,500 hours = P15.75 per hour. AH ( AR – strontium ) = Labor Rate Variance 3,500 hours ( P15.75 – P15.00 ) = P2,625 U. 114. Hard

The supervisory program of the price department has barely conferred with you concerning the division analysis of direct department of labor for the calendar month precisely ended. As she talked, you wrote feverishly, but you were n’t able to record all the information she gave you before she dashed off muttering something about “ another brush fire to put out. ” Your efforts are shown below : 4,800 hours adam P7.20 ____ hours x P____ ____ hours x P____ _________________ __________________ __________________ | | | | | | | | | | | Efficiency variation | | | P2,250 U | | | | _____________________________________________________________ Total variance, P810 U _____________________________________________________________ Required : a. To redeem yourself, complete the form above, adding numbers SH, AR, SR, etc., may be used where allow. ) barn. If you know that 18 minutes of department of labor is criterion per unit of measurement of produced ?

and labels. ( The common notations, AH, production, how many units were

Answer : a. AH X AR AH X SR SH X SR 4,800 hours X P7.20 4,800 hours X P7.50 4,500 hours X P7.50 P34,560 P36,000 P33,750 Rate discrepancy, P1,440 F

Efficiency variation, P2,250 U

Total division, P810 U Computations — in this decree : rate variance = Total discrepancy – efficiency variance = P810U – P2,250U = P810 – P2,250 = -P1,440 = P1,440F AH X AR = 4,800 x P7.20 = P34,560 AH X SR = AH X AR – rate variability = P34,560 – P1,440F = P34,560 – ( -P1,440 ) = P36,000

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SR = ( AH X SR ) ÷ AH = P36,000 ÷ 4,800 = P7.50 SH X SR = AH X SR – efficiency variance = P36,000 – P2,250U = P36,000 – P2,250 = P33,750 SH = ( SH X SR ) ÷ SR = P33,750 ÷ P7.50 = 4,500 b. Standard hours allowed for units produced … … …. 4,500 Divide by fraction of hour allowed per unit … … .. 18/60 actual units … … … … … … … … … … … … … 15,000 115. easy

The take after labor movement standards have been established for a particular intersection : standard undertaking hours per unit of measurement of output .. 2.8 hours Standard british labour party rate … … … … … … …. P11.50 per hour The follow data pertain to operations concerning the product for the last calendar month : actual hours worked … … … … … … …. 6,900 hours Actual total undertaking price … … … … … … P80,385 Actual output … … … … … … … … …. 2,300 units Required : a. What is the labor rate variability for the month ? b. What is the labor efficiency variation for the month ? answer : department of labor rate variance = ( AH x AR ) – ( AH x SR ) = P80,385 – ( 6,900 x P11.50 ) = P1,035 U SH = Standard hours per unit of measurement x Actual output signal = 2.8 ten 2,300 = 6,440 Labor efficiency division = SR ( AH – SH ) = P11.50 ( 6,900 – 6,440 ) = P5,290 U

116. comfortable

The follow standards for variable manufacturing overhead have been established for a caller that makes only one product : standard hours per unit of output … … 6.9 hours Standard variable overhead rate … … .. P15.80 per hour The follow data pertain to operations for the last month : actual hours … … … … … … … … … 6,100 hours actual total variable overhead monetary value …. P97,600 actual end product … … … … … … … … .. 800 units

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Required : a. What is the variable disk overhead spend variability for the month ? b. What is the variable overhead efficiency variability for the calendar month ? answer : variable operating expense outgo variance = ( AH x AR ) – ( AH x SR ) = P97,600 – ( 6,100 x P15.80 ) = P1,220 U SH = Standard hours per unit x Actual output signal = 6.9 ten 800 = 5,520 variable overhead efficiency discrepancy = SR ( AH – SH ) = P15.80 ( 6,100 – 5,520 ) = P9,164 U

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