234
239) The following data for November have been provided by Hunn Corporation, a producer of
precision drills for oil exploration:
Budgeted production
3,700
drills
Standard machine-hours per drill
9.0
machine-hours
Standard indirect labor
$
8.80
per machine-hour
Standard power
$
2.40
per machine-hour
Actual production
3,900
drills
Actual machine-hours
35,350
machine-hours
Actual indirect labor
$
313,923
Actual power
$
83,310
–
Required:
Compute the variable overhead rate variances for indirect labor and for power for November.
Indicate whether each of the variances is favorable (F) or unfavorable (U).
236
240) The following data have been provided by Lopus Corporation:
Budgeted production
2,600
units
Standard machine-hours per unit
2.7
machine-hours
Standard lubricants
$
4.20
per machine-hour
Standard supplies
$
2.90
per machine-hour
Actual production
2,900
units
Actual machine-hours
8,080
machine-hours
Actual lubricants (total)
$
35,151
Actual supplies (total)
$
23,038
–
Required:
Compute the variable overhead rate variances for lubricants and for supplies. Indicate whether
each of the variances is favorable (F) or unfavorable (U).
238
241) The following standards for variable overhead have been established for a company that
makes only one product:
Standard hours per unit of output
3.6
hours
Standard variable overhead rate
$
16.05
per hour
–
The following data pertain to operations for the last month:
Actual hours
5,000
hours
Actual total variable overhead cost
$
80,000
Actual output
1,300
units
–
Required:
a. What is the variable overhead rate variance for the month?
b. What is the variable overhead efficiency variance for the month?
242) Creger Corporation, which makes landing gears, has provided the following data for a recent
month:
Budgeted production
7,900
gears
Standard machine-hours per gear
9.3
machine-hours
Budgeted supplies cost
$
6.20
per machine-hour
Actual production
8,300
gears
Actual machine-hours
76,930
machine-hours
Actual supplies cost (total)
$
479,438
–
Required:
Determine the rate and efficiency variances for the variable overhead item supplies and indicate
whether those variables are favorable or unfavorable.
243) Balladares Inc. has a standard cost system. Variable manufacturing overhead is applied to
products on the basis of direct labor-hours. The standard for variable manufacturing overhead is
0.10 hours at $6.30 per hour. The company has reported the following actual results for the product
for May:
Actual output
2,000
units
Actual direct labor-hours
190
hours
Actual variable overhead cost
$1,083
Required:
a. Compute the variable overhead rate variance for May.
b. Compute the variable overhead efficiency variance for May.
244) Bondi Corporation makes automotive engines. For the most recent month, budgeted
production was 1,500 engines. The standard power cost is $3.10 per machine-hour. The company’s
standards indicate that each engine requires 9.3 machine-hours. Actual production was 1,800
engines. Actual machine-hours were 15,860 machine-hours. Actual power cost totaled $51,593.
Required:
Determine the rate and efficiency variances for the variable overhead item power cost and indicate
whether those variances are unfavorable or favorable.
243
245) Freytag Corporation’s variable overhead is applied on the basis of direct labor-hours. The
company has established the following variable overhead standards for product N06C:
Standard direct labor-hours
5.5
hours per unit of N06C
Standard variable overhead rate
$
4.10
per hour
–
The following data pertain to the most recent month’s operations during which 1,600 units of
product N06C were made:
Actual direct labor-hours worked
8,700
Actual variable overhead incurred
$
36,540
–
Required:
a. What was the variable overhead rate variance for the month?
b. What was the variable overhead efficiency variance for the month?
246) Highfill Corporation’s variable overhead is applied on the basis of direct labor-hours. The
standard cost card for product D80D specifies 8.4 direct labor-hours per unit of D80D. The
standard variable overhead rate is $5.60 per direct labor-hour. During the most recent month, 800
units of product D80D were made and 6,800 direct labor-hours were worked.
The actual variable overhead incurred was $41,140.
Required:
a. What was the variable overhead rate variance for the month?
b. What was the variable overhead efficiency variance for the month?
247) Sade Inc. has provided the following data concerning one of the products in its standard cost
system. Variable manufacturing overhead is applied to products on the basis of direct labor-hours.
Inputs
Standard Quantity or
Hours per Unit of Output
Standard Price
or Rate
Variable manufacturing overhead
0.20 hours
$7.00 per hour
The company has reported the following actual results for the product for December:
Actual output
5,300
units
Actual direct labor-hours
1,160
hours
Actual variable overhead rate
$6.80
per hour
Required:
a. Compute the variable overhead rate variance for December.
b. Compute the variable overhead efficiency variance for December.