This is the same information: Direct material: 3 pounds per unit @ $4 per pound

Question

This is the same information: Direct material: 3 pounds per unit @ $4 per pound $12 per unit Direct labor: 2 hours per unit @ $8 per hour $16 per unit Variable manufacturing overhead: 2 hours per unit @ $5 per hour $10 per unit Actual production figures for the past year are given below. The company records the materials price variance when materials are purchased Units produoed 600 units 2,000 pounds Direct material used.... Direct material purchased (3,000 pounds. $11,400 Direct labor cost (1,100 hours).... Variable manufacturing overhead cost incured...$5,720 S9,240 17. The materials quantity variance is: A. $800 U B. $4,000 U C. $760 U D. $760 F 18. Let qu represents client visits and q represents hours of operations. The electricity cost for Blissful Spa depends on both client-visits and the hours of operations and its cost formula is S500+S0.15q +1.00 qp. If the actual number of client visits is 1000 and the salon was open for 2500 hours during the month, the flexible budget amount for electricity is: A. S501.15 B. S651.00 C. $3,150.00 D $18,000.00

Explanation / Answer

17) Material quantity variance = (600*3-2000)*4 = 800 U

so answer is a) $800 U

18) Flexible budget amount for electricity = (500+0.15*1000+1*2500) = 3150

so answer is c) $3150

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