Becton Labs, Inc., produces various chemical compounds for industrial use. One c

Question

Becton Labs, Inc., produces various chemical compounds for industrial use. One compound, called Fludex, is prepared using an elaborate distilling process. The company has developed standard costs for one unit of Fludex, as follows: Standard Quantity or Hours 2.5 ounces Standard Price Standard ok or Rate Cost $20.00 per ounce $22.50 per hour $3.50 per hour .00 31.50 4.90 5e Direct materials Direct labor Variable manufacturing overhead1.4 hours it 1.4 hours nces $ 86.40 Total standard cost per unit During November, the following activity was recorded related to the production of Fludex a. Materials purchased, 12,000 ounces at a cost of $225,000 b. There was no beginning inventory of materials; however, at the end of the month, 2,500 ounces of material remained in ending inventony 160 hours at an average pay rate of $22 per hour during Novemher totaled $18 200 c. The company employs 35 lab technicians to work on the production of Fludex. During November, they each worked an average of d. Variable manufacturing overhead is assigned to Fludex on the basis of direct labor-hours. Variable manufacturing overhead costs e here to search

Explanation / Answer

1) for direct materials a. price and quantity variance Standard - Actual * Actual = Variance price price quantiy materials price variance 20 18.75 12,000 = 15000 F standard - Actual * Standard = Variance qty qty price materials quantity variance 9375 9,500 20 2500 U b. yes 2) for direct labor Standard - Actual * Actual = Variance rate rate hours labor price variance 22.5 22 5600 = 2800 F standard - Actual * Standard = Variance hours hours rate labor efficiency variance 5250 5,600 22.5 7875 U b. no 3) for variable overhead Standard - Actual * Actual = Variance rate rate hours Variable overhead rate 3.5 3.25 5,600 = 1400 F standard - Actual * Standard = Variance hours hours rate variable overhead efficiency 5250 5,600 3.5 1225 U

Related Questions

Navigate

• Browse (All)
• Browse B
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.