Required: 1. How many units were produced last period? 2. How many pounds of dir

Question

Required: 1. How many units were produced last period? 2. How many pounds of direct material were purchased and used in production? 3. What was the actual cost per pound of material? (Round your answer to 2 decimal places.) 4. How many actual direct labor-hours were worked during the period? 5. What was the actual rate paid per direct labor-hour? (Round your answer to 2 decimal places.) 6. How much actual variable manufacturing overhead cost was incurred during the period? 1. Number of units produced 2. Pounds of direct material purchased and used in production 3. Actual cost per pound 4. Actual direct labor-hours 5. Actual rate per direct labor-hour 6. Actual variable manufacturing overhead cost 18,000

Explanation / Answer

Solution 1:

Nos of units produced = Standard cost of direct material / Standard rate per unit = $641,520 / 35.64 = 18000 units

Solution 2:

Direct material quantity variance = $32,400 U

(SQ - AQ) * SR = -$32.400

(18000*2.20 - AQ) * 16.20 = -$32,400

AQ = 41600 pound

Pound of direct material purchased and used in production = 41600 pound

Solution 3:

Material price variance = $12,064 F

(SP - AP)* AQ = $12,064

($16.20 - AP) * 41600 = $12,064

AP = $15.91

Actual cost per pound = $15.91

Solution 4:

Direct labor efficiency variance = $15,300 U

(SH - AH) * SR = -$15,300

(18000 * 1 - AH) * $15.30 = -$15,300

AH = 19000

Actual direct labor hours = 19000

Solution 5:

Direct labor rate variance = $3,800 U

(SR - AR) * AH = -$3,800

($15.30 - AR) * 19000 = -$3,800

Actual rate of direct labor = $15.50 per hour

Solution 6:

Variable overhead efficiency variance = (SH - AH) * SR

= (18000 - 19000) * $9.10 = $9,100 U

Actual variable overhead incurred = Standard variable overhead + Variable overhead rate variance + Variable overhead efficiency variance

= $163,800 + $4,900 F + $9,100 U

= $168,000

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