Marvel Parts, Inc., manufacture ar. The company has a standard cost system in us
ID: 2406356 • Letter: M
Question
Marvel Parts, Inc., manufacture ar. The company has a standard cost system in use for all of ts products. According to the standards that have been s auto accessories. One of the company's products is a set of seat covers that can be adjusted to fit set for the seat covers, the factory should work 1,040 hours each month to produce 2.080 sets of covers. The standard associated with this level of production are: covers. The standard costs $ 7,288 3.50 Variable manufacturing overhead (based on direct labor-hours) 4,1602.e0 $25.08 During August, the factory worked only 600 direct labor-hours and produced 1,800 sets of covers. The following actual costs were recorded during the month: Total of Cove $ 34,20e $19.88 $ 6,660 3.78 4,148 2.3e $25.00 Direct materials (5,880 yards) Direct labor Variable manufacturing overhead At standard, each set of covers should require 25 yards of maternial. All of the materials purchased during the month we production.Explanation / Answer
Answers
Actual DATA for
1800
units
Quantity (AQ)
Rate (AR)
Actual Cost
Direct Material
5000
$ 6.84 [34200/5000]
$ 34,200.00
Direct labor
600
$ 11.10
$ 6,660.00
Variable Overhead
600
$ 6.90
$ 4,140.00
Standard DATA for
1800
units
Quantity (SQ)
Rate (SR)
Standard Cost
Direct Material
4500 [2.5 x 1800]
$ 7.80 [19.5/2.5]
$ 35,100.00
Direct labor
900 [1040 x 1800/2080]
$ 7.00
$ 6,300.00
Variable Overhead
900
$ 4.00
$ 3,600.00
Material Price Variance
(
Standard Rate
-
Actual Rate
)
x
Actual Quantity
(
$ 7.80
-
$ 6.84
)
x
5000
4800
Variance
$ 4,800.00
Favourable-F
Material Quantity Variance
(
Standard Quantity
-
Actual Quantity
)
x
Standard Rate
(
4500
-
5000
)
x
$ 7.80
-3900
Variance
$ 3,900.00
Unfavourable-U
Labor Rate Variance
(
Standard Rate
-
Actual Rate
)
x
Actual Labor Hours
(
$ 7.00
-
$ 11.10
)
x
600
-2460
Variance
$ 2,460.00
Unfavourable-U
Labour Efficiency Variance
(
Standard Hours
-
Actual Hours
)
x
Standard Rate
(
900
-
600
)
x
$ 7.00
2100
Variance
$ 2,100.00
Favourable-F
Variable Overhead Rate Variance
(
Standard Rate
-
Actual Rate
)
x
Actual Labor Hours
(
$ 4.00
-
$ 6.90
)
x
600
-1740
Variance
$ 1,740.00
Unfavourable-U
Variable Overhead Efficiency Variance
(
Standard Hours
-
Actual Hours
)
x
Standard Rate
(
900
-
600
)
x
$ 4.00
1200
Variance
$ 1,200.00
Favourable-F
Actual DATA for
1800
units
Quantity (AQ)
Rate (AR)
Actual Cost
Direct Material
5000
$ 6.84 [34200/5000]
$ 34,200.00
Direct labor
600
$ 11.10
$ 6,660.00
Variable Overhead
600
$ 6.90
$ 4,140.00
Standard DATA for
1800
units
Quantity (SQ)
Rate (SR)
Standard Cost
Direct Material
4500 [2.5 x 1800]
$ 7.80 [19.5/2.5]
$ 35,100.00
Direct labor
900 [1040 x 1800/2080]
$ 7.00
$ 6,300.00
Variable Overhead
900
$ 4.00
$ 3,600.00
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