Barley Hopp, Inc., manufactures custom-ordered commemorative beer steins. Its st

Question

Barley Hopp, Inc., manufactures custom-ordered commemorative beer steins. Its standard cost information follows:

Barley Hopp had the following actual results last year:

Required:
a. Calculate the direct materials price, quantity, and total spending variances for Barley Hopp. (Do not round your intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable and "U" for unfavorable.)



b. Calculate the direct labor rate, efficiency, and total spending variances for Barley Hopp. (Do not round your intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable and "U" for unfavorable.)



c. Calculate the variable overhead rate, efficiency, and total spending variances for Barley Hopp. (Do not round your intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable/Overapplied and "U" for unfavorable/underapplied.)

Standard Quantity Standard Price (Rate) Standard Unit Cost Direct materials (clay) 1.60 lbs. $ 1.70 per lb. $ 2.72 Direct labor 1.60 hrs. $ 11.00 per hr. 17.60 Variable manufacturing overhead (based on direct labor hours) 1.60 hrs. $ 1.10 per hr. 1.76 Fixed manufacturing overhead ($275,000.00 ÷ 110,000.00 units) 2.50

Explanation / Answer

Std Quantity required per unit of output: 1.60 lbs Actual output: 115000 Std quantity allowedd (115000*1.60): 184000 lbs Std price per lbs: $ 1.70 per lbs Actual Quantity used: 198200 lbs Actual price per lbs (317120/198200): $ 1.60 per lbs Material price variance: Actual Qty used ( Std price -Actual price) 198200 (1.70-1.60): $ 19820 Fav Material Efficiency Variance: Std price (Std qty-Actual Qty) 1.70 (184000-198200) = $24140 Unfav Total Material cost variance: Std price*Std qty - Actual Price*Actual Qty 1.7*184000-1.6*198200 = $ 4320 Unfav Std labour hour per unit: 1.60 hr per unit Std labour hours allowed (115000*1.60): 184000 hours Std rate per hour: $ 11.00 per hour Actual Labour hourrs: 160000 hours Actual rate per hour (2080000/160000): $ 13 per hour Labour rate variance: Actual hours (Std rate - Actual rate) 160000 (11-13): $ 320000 Unfav Labour efficiency variance: Std rate (Std hours - Actual hours) 11 ( 184000-160000)= $ 264000 Fav Labour cost variance: Std hours*Std rate - Actual Hours*Actual Rate 184000 *11 - 160000*13 = $ 56000 Unfav Std variable OH rate per hour: 1.10 per hour Actual Variable OH rate per hour (220000/160000): $ 1.375 per hour Variable OH rate variance: Actual Hours (Std rate-Actual Rate) 160000 (1.10-1.375)= $ 44000 Unfav Variable OH efficiency Variance: Std rate (Std hours-Actual hours) 1.10 (184000-160000)= $26400 Fav Total Spending variance: Std oh rate *Std hours- Actual OH rate*Actual hours 1.10 *184000 - 1.375*160000 = $ 17600 Unfav

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