17–61
Fixed costs
500,000
500,000
Net income
463,900
280,300
Units
252,000
108,000
At the end of the year, the total fixed costs and the variable costs per unit were exactly as
budgeted, but the following units per product line were sold. Trend, Inc. analyzes the
effects its sales variances have on the profitability of the company.
Product Lines
Units
Sales
A
253,230
$1,848,579
B
113,770
$1,479,010
Is the total sales quantity variance favorable or unfavorable?
76.
A manufacturer of industrial equipment has a standard costing system based on standard
direct labor-hours (DLHs) as the measure of activity. Data from the company’s flexible
budget for manufacturing overhead are given below:
Level of activity
2,500
DLHs
Overhead costs at the
denominator activity level:
Variable overhead cost
$8,500
Fixed overhead cost
$34,625
The following data pertain to operations for the most recent period:
Actual hours
2,600
DLHs
Standard hours allowed for the
actual output
2,592
DLHs
Actual total variable
manufacturing overhead cost
$9,100
Actual total fixed manufacturing
overhead cost
$35,025
17–63
77.
A manufacturer of industrial equipment has a standard costing system based on standard
direct labor-hours (DLHs) as the measure of activity. Data from the company’s flexible
budget for manufacturing overhead are given below:
Level of activity
2,500
DLHs
Overhead costs at the
denominator activity level:
Variable overhead cost
$8,500
Fixed overhead cost
$34,625
The following data pertain to operations for the most recent period:
Actual hours
2,600
DLHs
Standard hours allowed for the
actual output
2,592
DLHs
Actual total variable
manufacturing overhead cost
$9,100
Actual total fixed manufacturing
overhead cost
$35,025
78.
The labor yield variance is actual total hours at:
79.
The labor mix variance is actual total hours at:
80.
The computation of the material yield variance does not require the:
81.
A credit balance in the labor yield variance implies:
17–67
82.
83.
What is the correct journal entry to record direct labor when the actual labor mix is
favorable and the total standard hours allowed is greater than the total actual hours
worked?
84.
The Shum Company makes a product, Z, from two materials: X and Y. The standard prices
and quantities are as follows:
X
Y
Price per pound
$6
$9
Pounds per unit of product Z
10
5
In May, 21,000 units of Z were produced by Shum Company, with the following actual
prices and quantities of materials used:
X
Y
Price per pound
$5.70
$8.40
Pounds used
216,000
114,000
What is the total direct materials mix variance for May?
85.
The Shum Company makes a product, Z, from two materials: X and Y. The standard prices
and quantities are as follows:
X
Y
Price per pound
$6
$9
Pounds per unit of product Z
10
5
In May, 21,000 units of Z were produced by Shum Company, with the following actual
prices and quantities of materials used:
X
Y
Price per pound
$5.70
$8.40
Pounds used
216,000
114,000
Is the total direct materials mix variance favorable or unfavorable?
86.
The Shum Company makes a product, Z, from two materials: X and Y. The standard prices
and quantities are as follows:
X
Y
Price per pound
$6
$9
Pounds per unit of product Z
10
5
In May, 21,000 units of Z were produced by Shum Company, with the following actual
prices and quantities of materials used:
X
Y
Price per pound
$5.70
$8.40
Pounds used
216,000
114,000
What is the total direct material yield variance for May?
87.
The Shum Company makes a product, Z, from two materials: X and Y. The standard prices
and quantities are as follows:
X
Y
Price per pound
$6
$9
Pounds per unit of product Z
10
5
In May, 21,000 units of Z were produced by Shum Company, with the following actual
prices and quantities of materials used:
X
Y
Price per pound
$5.70
$8.40
Pounds used
216,000
114,000
Is the total direct material yield variance favorable or unfavorable?
17–75
88.
The Becton Enterprises (BE) produces a gasoline additive, Charger Power. This product
increases engine efficiency and improves gasoline mileage by creating a more complete
burn in the combustion process. Careful controls are required during the production
process to insure that the proper mix of input chemicals is achieved and that evaporation
is controlled. Loss of output and efficiency may result if the controls are not effective.
The standard cost of producing a 500-liter batch of Charger Power is $135. The standard
materials mix and related standard cost of each chemical used in a 500-liter batch are:
Chemical
Std input
quantity
Std cost
per liter
Total
cost
Echol
200
$0.200
$40.00
Protex
100
0.425
42.50
Benz
250
0.150
37.50
CT–40
50
0.300
15.00
600
$135.00
The quantities of chemicals purchased and used during the current production period are
shown in the schedule below. A total of 140 batches of Charger Power were manufactured
during the current production period. The controller of BE has determined its costs and
chemical usage variations at the end of the production period.
Chemical
Quantity
Purchased
Total
Cost
Quantity
Used
Echol
25,000
$5,365
26,600
Protex
13,000
6,240
12,880
Benz
40,000
5,840
37,800
CT–40
7,500
2,220
7,140
85,500
84,420
If BE recognizes all variances at the earliest possible moment, what is the total material
price variance?
17–77
89.
The Becton Enterprises (BE) produces a gasoline additive, Charger Power. This product
increases engine efficiency and improves gasoline mileage by creating a more complete
burn in the combustion process. Careful controls are required during the production
process to insure that the proper mix of input chemicals is achieved and that evaporation
is controlled. Loss of output and efficiency may result if the controls are not effective.
The standard cost of producing a 500-liter batch of Charger Power is $135. The standard
materials mix and related standard cost of each chemical used in a 500-liter batch are:
Chemical
Std input
quantity
Std cost
per liter
Total
cost
Echol
200
$0.200
$40.00
Protex
100
0.425
42.50
Benz
250
0.150
37.50
CT–40
50
0.300
15.00
600
$135.00
The quantities of chemicals purchased and used during the current production period are
shown in the schedule below. A total of 140 batches of Charger Power were manufactured
during the current production period. The controller of BE has determined its costs and
chemical usage variations at the end of the production period.
Chemical
Quantity
Purchased
Total
Cost
Quantity
Used
Echol
25,000
$5,365
26,600
Protex
13,000
6,240
12,880
Benz
40,000
5,840
37,800
CT–40
7,500
2,220
7,140
85,500
84,420
17–79
90.
The Becton Enterprises (BE) produces a gasoline additive, Charger Power. This product
increases engine efficiency and improves gasoline mileage by creating a more complete
burn in the combustion process. Careful controls are required during the production
process to insure that the proper mix of input chemicals is achieved and that evaporation
is controlled. Loss of output and efficiency may result if the controls are not effective.
The standard cost of producing a 500-liter batch of Charger Power is $135. The standard
materials mix and related standard cost of each chemical used in a 500-liter batch are:
Chemical
Std input
quantity
Std cost
per liter
Total
cost
Echol
200
$0.200
$40.00
Protex
100
0.425
42.50
Benz
250
0.150
37.50
CT–40
50
0.300
15.00
600
$135.00
The quantities of chemicals purchased and used during the current production period are
shown in the schedule below. A total of 140 batches of Charger Power were manufactured
during the current production period. The controller of BE has determined its costs and
chemical usage variations at the end of the production period.
Chemical
Quantity
Purchased
Total
Cost
Quantity
Used
Echol
25,000
$5,365
26,600
Protex
13,000
6,240
12,880
Benz
40,000
5,840
37,800
CT–40
7,500
2,220
7,140
85,500
84,420
