ACCT 321 Cost Accounting 1 (Weiss) Fall 2017 Makeup Exam 3 2. (15 pts.) The foll
ID: 2571481 • Letter: A
Question
ACCT 321 Cost Accounting 1 (Weiss) Fall 2017 Makeup Exam 3 2. (15 pts.) The following information pertains to Grant Company: Direct Manufacturing Direct Materials Labor Costs incurred: actual inputs x actual prices Standard inputs allowed for actual input x standard prices Actual inputs x standard prices $ 100,000 S 45.000 112.500 40.000 42.000 S 109,000 Required: Compute price, efficiency, and total flexible budget variances for (a) direct materials and (b) direct manufacturing labor. Use the three prongs provided below. Label as Favorable or Unfavorable providing U or F as a label. a.Explanation / Answer
Total Material Cost Variance = Standard Cost for Actual Output - Actual Cost Incurred
= 112500 - 100000
= 12500 Fav
Material Price Variancce = Standard Price x Actual Qty - Actual Price x Actual Qty
= 109000 -100000
= 9000 Fav
Material Efficiency Variance = Standard Qty x Standard Price - Actual Qty x Standard Price
= 112500 - 109000
= 3500 Fav
Total Labor Cost Variance = Standard Cost for Actual Output - Actual Cost Incurred
= 40000 - 45000
= 5000 Unfav
Labor Rate Variance = Standard Rate x Actual Qty - Actual Price x Actual Qty
= 42000 - 45000
= 3000 Unfav
Labor Efficiency Variance = Standard Qty x Standard Price - Actual Qty x Standard Price
= 40000 - 42000
= 2000 Unfav
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