Need answer for the second paper Problem 6 (20 points) ards stand The Apoundrigh
ID: 2414241 • Letter: N
Question
Need answer for the second paper
Problem 6 (20 points) ards stand The Apoundright Company uses standard costing and has established the for its single product: Direct materials: 4 gallons at $8 per gallon Direct labor: 1.0 hours at 516 per hour Variable overhead: 0.5 hours at $8 per hour During November, the company made 6,000 units and incurred the followings Direct materials purchased: 26,800 gallons at $8.20 per gallon Direct materials used: 25,200 gallons Direct labor used: 5,600 hours at $15.30 per hour Actual variable overhead: $23,800 The company applies variable overhead to products on the basis of standard direct labor -hours. The materials price variance for November was: A. $5,360 F B, $5,360 U C. $5,040 F D. $5,040 U The materials quantity variance for November was: A. $22,960 U B. $22,400 U C. $9,600U D. $9,840 u AQ x AP AQ x SP (for qty) AQ x SP (for price) SQ x SP , Price VarianceExplanation / Answer
Answers
AQ
x
AP
AQ
x
SP
AQ
x
SP
SQ
x
SP
25200 gallons
x
8.2 per gallons
25200 gallons
x
8 per gallon
25200 gallons
x
8 per gallon
[6000 units x 4 gallons per unit] 24,000 gallons
x
8 per gallon
A
$ 2,06,640.00
B
$ 2,01,600.00
C
$ 2,01,600.00
D
$ 1,92,000.00
Material Price variance = B - A
Material Quantity variance = D - C
$ (5,040.00)
$ (9,600.00)
Correct Answer: Option 'D' $ 5,040 Unfavourable
Correct Answer: Option 'C' $ 9,600 Unfavourable
AQ
x
AP
AQ
x
SP
AQ
x
SP
SQ
x
SP
5600 hours
x
15.3 per hour
5600 hours
x
16 per hour
5600 hours
x
16 per hour
[6000 units x 1 hour per unit] 6000 hours
x
16 per hour
A
$ 85,680.00
B
$ 89,600.00
C
$ 89,600.00
D
$ 96,000.00
Labor Rate variance = B - A
Labor Efficiency variance = D - C
$ 3,920.00
$ 6,400.00
Correct Answer: Option 'D' $ 3,920 Favourable
Correct Answer: Option 'A' $ 6,400 Favourable
AQ
x
AP
AQ
x
SP
AQ
x
SP
SQ
x
SP
5600 hours
x
[23800/5600 hours] 4.25 per hour
5600 hours
x
8 per hour
5600 hours
x
8 per hour
[6000 units x 0.5 hour per unit] 3000 hours
x
8 per hour
A
$ 23,800.00
B
$ 44,800.00
C
$ 44,800.00
D
$ 24,000.00
Variable Overhead Rate variance = B - A
Variable Overhead Efficiency variance = D - C
$ 21,000.00
$ (20,800.00)
Variable Overhead Spending Variance = rate variance + efficiency variance = 21000 + (-20800) = $ 200 Favourable
Note: Variable Overhead Spending Variance = $ 200 Favourable, but there’s some mistake in Options available as $ 200 Unfavourable has been mentioned twice (Option A and Option C are same), while the correct answer $ 200 Favourable is not mentioned.
AQ
x
AP
AQ
x
SP
AQ
x
SP
SQ
x
SP
25200 gallons
x
8.2 per gallons
25200 gallons
x
8 per gallon
25200 gallons
x
8 per gallon
[6000 units x 4 gallons per unit] 24,000 gallons
x
8 per gallon
A
$ 2,06,640.00
B
$ 2,01,600.00
C
$ 2,01,600.00
D
$ 1,92,000.00
Material Price variance = B - A
Material Quantity variance = D - C
$ (5,040.00)
$ (9,600.00)
Correct Answer: Option 'D' $ 5,040 Unfavourable
Correct Answer: Option 'C' $ 9,600 Unfavourable
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