86) Use the following data to find the direct labor efficiency variance if the company produced
3,500 units during the period.
Direct labor standard (4 hrs. @ $12/hr.)
$
48
per unit
Actual hours worked
12,250
Actual rate per hour
$
12.50
A) $6,125 unfavorable.
B) $7,000 unfavorable.
C) $7,000 favorable.
D) $21,000 favorable.
E) $6,125 favorable.
AH × SR
(12,250) × $12 /hr.
147,000
SH × SR
(3,500 units × 4 hours/unit) × $12/hr.
168,000
Total direct labor variance
21,000
F
87) Use the following data to find the direct labor rate variance if the company produced 7,000
units of product during the period.
Standard:
Direct labor (3.2 hrs. per unit @ $12/hr.)
$
38.40
per unit
Actual cost incurred:
Direct labor (24,500 hrs. @ $12.50/hr.)
$
306,250
A) $12,250 unfavorable.
B) $14,700 unfavorable.
C) $14,700 favorable.
D) $12,250 favorable.
E) $26,950 favorable.
AH × AR
Given.
$
306,250
AH × SR
24,500 hrs. × $12/hr.
294,000
Direct labor rate variance
$
U
88) The following company information is available for March. The direct materials price
variance is:
Direct materials purchased and used
2,500 feet @ $55 per foot
Standard costs for direct materials for March production
2,600 feet @ $53 per foot
A) $5,000 favorable.
B) $300 favorable.
C) $5,200 unfavorable.
D) $5,000 unfavorable.
E) $5,200 favorable.
AQ × AP
2,500 feet × $55/foot
AQ × SP
2,500 feet × $53/foot
Direct materials price variance
U
89) The following company information is available. The direct materials quantity variance is:
Direct materials used for production
36,000 gallons
Standard quantity for units produced
34,400 gallons
Standard cost per gallon of direct material
6.00
Actual cost per gallon of direct material
6.10
A) $10,000 unfavorable.
B) $13,200 unfavorable.
C) $9,600 unfavorable.
D) $10,000 favorable.
E) $13,200 favorable.
AQ × SP
36,000 gallons × $6.00/gallon
SQ × SP
34,400 gallons × $6.00/gallon
Direct materials quantity variance
U
90) Summerlin Company budgeted 4,000 pounds of material costing $5.00 per pound to produce
2,000 units. The company actually used 4,500 pounds that cost $5.10 per pound to produce 2,000
units. What is the direct materials quantity variance?
A) $400 unfavorable.
B) $450 unfavorable.
C) $2,500 unfavorable.
D) $2,550 unfavorable.
E) $2,950 unfavorable.
91) Summerlin Company budgeted 4,000 pounds of material costing $5.00 per pound to produce
2,000 units. The company actually used 4,500 pounds that cost $5.10 per pound to produce 2,000
units. What is the direct materials price variance?
A) $400 unfavorable.
B) $450 unfavorable.
C) $2,500 unfavorable.
D) $2,550 unfavorable.
E) $2,950 unfavorable.
92) A company has established 5 pounds of Material J at $2 per pound as the standard for the
material in its Product Z. The company has just produced 1,000 units of this product, using 5,200
pounds of Material J that cost $9,880. The direct materials quantity variance is:
A) $400 unfavorable.
B) $120 favorable.
C) $400 favorable.
D) $520 favorable.
E) $520 unfavorable.
93) A company has established 5 pounds of Material J at $2 per pound as the standard for the
material in its Product Z. The company has just produced 1,000 units of this product, using 5,200
pounds of Material J that cost $9,880.The direct materials price variance is:
A) $520 unfavorable.
B) $400 unfavorable.
C) $120 favorable.
D) $520 favorable.
E) $400 favorable.
94) A job was budgeted to require 3 hours of labor per unit at $11.00 per hour. The job consisted
of 8,000 units and was completed in 22,000 hours at a total labor cost of $269,500. What is the
total labor cost variance?
A) $2,000 unfavorable.
B) $3,000 unfavorable.
C) $5,500 unfavorable.
D) $8,000 unfavorable.
E) $9,000 unfavorable.
95) A job was budgeted to require 3 hours of labor per unit at $11.00 per hour. The job consisted
of 8,000 units and was completed in 22,000 hours at a total labor cost of $269,500. What is the
direct labor rate variance?
A) $27,500 unfavorable.
B) $22,000 favorable.
C) $16,000 unfavorable.
D) $16,000 favorable.
E) $6,000 unfavorable.
96) A job was budgeted to require 3 hours of labor per unit at $11.00 per hour. The job consisted
of 8,000 units and was completed in 22,000 hours at a total labor cost of $269,500. What is the
direct labor efficiency variance?
A) $27,500 unfavorable.
B) $22,000 unfavorable.
C) $16,000 unfavorable.
D) $22,000 favorable.
E) $6,000 unfavorable.
97) The standard materials cost to produce 1 unit of Product R is 6 pounds of material at a
standard price of $50 per pound. In manufacturing 8,000 units, 47,000 pounds of material were
used at a cost of $51 per pound. What is the total direct materials cost variance?
A) $48,000 unfavorable.
B) $51,000 favorable.
C) $51,000 unfavorable.
D) $3,000 favorable.
E) $3,000 unfavorable.
98) The standard materials cost to produce 1 unit of Product R is 6 pounds of material at a
standard price of $50 per pound. In manufacturing 8,000 units, 47,000 pounds of material were
used at a cost of $51 per pound. What is the direct materials price variance?
A) $47,000 unfavorable.
B) $47,000 favorable.
C) $50,000 unfavorable.
D) $50,000 favorable.
E) $3,000 favorable.
99) The standard materials cost to produce 1 unit of Product R is 6 pounds of material at a
standard price of $50 per pound. In manufacturing 8,000 units, 47,000 pounds of material were
used at a cost of $51 per pound. What is the direct materials quantity variance?
A) $47,000 unfavorable.
B) $47,000 favorable.
C) $50,000 unfavorable.
D) $50,000 favorable.
E) $3,000 favorable.
100) The following information describes a company’s usage of direct labor in a recent period.
The direct labor efficiency variance is:
Actual hours used
45,000
Actual rate per hour
$
15.00
Standard rate per hour
$
14.50
Standard hours for units produced
47,000
A) $29,000 unfavorable.
B) $29,000 favorable.
C) $22,500 unfavorable.
D) $52,500 favorable.
E) $52,500 unfavorable.
AH × SR
45,000 hours × $14.50/hour
$
SH × SR
47,000 hours × $14.50/hour
Direct labor efficiency variance
$
F
101) The following information describes a company’s usage of direct labor in a recent period.
The direct labor rate variance is:
Actual hours used
45,000
Actual rate per hour
$
15.00
Standard rate per hour
$
14.50
Standard hours for units produced
47,000
A) $29,000 favorable.
B) $29,000 unfavorable.
C) $22,500 unfavorable.
D) $52,500 favorable.
E) $52,500 unfavorable.
AH × AR
45,000 hours × $15/hour
$
675,000
AH × SR
45,000 hours × $14.50/hour
652,500
Direct labor rate variance
$
22,500
U
102) The following information describes a company’s usage of direct labor in a recent period.
The total direct labor cost variance is:
Actual hours used
45,000
Actual rate per hour
$
15.00
Standard rate per hour
$
14.50
Standard hours for units produced
47,000
A) $6,500 favorable.
B) $29,000 favorable.
C) $22,500 unfavorable.
D) $22,500 favorable.
E) $6,500 unfavorable.
AH × AR
45,000 hours × $15/hour
$
675,000
SH × SR
47,000 hours × $14.50/hour
681,500
Total direct labor cost variance
$
F
103) A company uses the following standard costs to produce a single unit of output.
Direct materials
6 pounds at $0.90 per pound
$
5.40
Direct labor
0.5 hour at $12.00 per hour
$
6.00
Manufacturing overhead
0.5 hour at $4.80 per hour
$
2.40
During the latest month, the company purchased and used 58,000 pounds of direct materials at a
price of $1.00 per pound to produce 10,000 units of output. Direct labor costs for the month
totaled $56,350 based on 4,900 direct labor hours worked. Variable manufacturing overhead
costs incurred totaled $15,000 and fixed manufacturing overhead incurred was $10,400. Based
on this information, the direct materials price variance for the month was:
A) $6,000 unfavorable
B) $1,800 favorable
C) $1,000 favorable
D) $5,800 unfavorable
E) $1,800 unfavorable
104) A company uses the following standard costs to produce a single unit of output.
Direct materials
6 pounds at $0.90 per pound
$
5.40
Direct labor
0.5 hour at $12.00 per hour
$
6.00
Manufacturing overhead
0.5 hour at $4.80 per hour
$
2.40
During the latest month, the company purchased and used 58,000 pounds of direct materials at a
price of $1.00 per pound to produce 10,000 units of output. Direct labor costs for the month
totaled $56,350 based on 4,900 direct labor hours worked. Variable manufacturing overhead
costs incurred totaled $15,000 and fixed manufacturing overhead incurred was $10,400. Based
on this information, the direct materials quantity variance for the month was:
A) $1,800 favorable
B) $5,800 unfavorable
C) $5,800 favorable
D) $1,800 unfavorable
E) $1,000 favorable
105) A company uses the following standard costs to produce a single unit of output.
Direct materials
6 pounds at $0.90 per pound
$
5.40
Direct labor
0.5 hour at $12.00 per hour
$
6.00
Manufacturing overhead
0.5 hour at $4.80 per hour
$
2.40
During the latest month, the company purchased and used 58,000 pounds of direct materials at a
price of $1.00 per pound to produce 10,000 units of output. Direct labor costs for the month
totaled $56,350 based on 4,900 direct labor hours worked. Variable manufacturing overhead
costs incurred totaled $15,000 and fixed manufacturing overhead incurred was $10,400. Based
on this information, the total direct materials cost variance for the month was:
A) $4,000 unfavorable
B) $4,000 favorable
C) $5,800 favorable
D) $5,800 unfavorable
E) $1,800 favorable
106) A company uses the following standard costs to produce a single unit of output.
Direct materials
6 pounds at $0.90 per pound
$
5.40
Direct labor
0.5 hour at $12.00 per hour
$
6.00
Manufacturing overhead
0.5 hour at $4.80 per hour
$
2.40
During the latest month, the company purchased and used 58,000 pounds of direct materials at a
price of $1.00 per pound to produce 10,000 units of output. Direct labor costs for the month
totaled $56,350 based on 4,900 direct labor hours worked. Variable manufacturing overhead
costs incurred totaled $15,000 and fixed manufacturing overhead incurred was $10,400. Based
on this information, the direct labor rate variance for the month was:
A) $1,200 favorable
B) $3,650 favorable
C) $2,450 favorable
D) $3,650 unfavorable
E) $1,200 unfavorable
107) A company uses the following standard costs to produce a single unit of output.
Direct materials
6 pounds at $0.90 per pound
$
5.40
Direct labor
0.5 hour at $12.00 per hour
$
6.00
Manufacturing overhead
0.5 hour at $4.80 per hour
$
2.40
During the latest month, the company purchased and used 58,000 pounds of direct materials at a
price of $1.00 per pound to produce 10,000 units of output. Direct labor costs for the month
totaled $56,350 based on 4,900 direct labor hours worked. Variable manufacturing overhead
costs incurred totaled $15,000 and fixed manufacturing overhead incurred was $10,400. Based
on this information, the direct labor efficiency variance for the month was:
A) $3,650 favorable
B) $2,450 favorable
C) $1,200 unfavorable
D) $1,200 favorable
E) $2,450 unfavorable
108) A company uses the following standard costs to produce a single unit of output.
Direct materials
6 pounds at $0.90 per pound
$
5.40
Direct labor
0.5 hour at $12.00 per hour
$
6.00
Manufacturing overhead
0.5 hour at $4.80 per hour
$
2.40
During the latest month, the company purchased and used 58,000 pounds of direct materials at a
price of $1.00 per pound to produce 10,000 units of output. Direct labor costs for the month
totaled $56,350 based on 4,900 direct labor hours worked. Variable manufacturing overhead
costs incurred totaled $15,000 and fixed manufacturing overhead incurred was $10,400. Based
on this information, the total direct labor cost variance for the month was:
A) $3,650 favorable
B) $2,450 favorable
C) $1,200 unfavorable
D) $1,200 favorable
E) $2,450 unfavorable
109) The overhead cost variance is:
A) The difference between the overhead costs actually incurred and the overhead budgeted at the
actual operating level.
B) The difference between the actual overhead incurred during a period and the standard
overhead applied.
C) The difference between actual and budgeted cost caused by the difference between the actual
price per unit and the budgeted price per unit.
D) The costs that should be incurred under normal conditions to produce a specific product (or
component) or to perform a specific service.
E) The difference between the total overhead cost that would have been expected if the actual
operating volume had been accurately predicted and the amount of overhead cost that was
allocated to products using the standard overhead rate.
110) The difference between actual overhead costs incurred and the budgeted overhead costs
based on a flexible budget is the:
A) Production variance.
B) Quantity variance.
C) Volume variance.
D) Price variance.
E) Controllable variance.
111) When there is a difference between the actual and the standard capacity, which of the
following, based solely on fixed overhead, occurs:
A) Production variance.
B) Volume variance.
C) Overhead cost variance.
D) Quantity variance.
E) Controllable variance.
112) A company’s flexible budget for 48,000 units of production showed variable overhead costs
of $72,000 and fixed overhead costs of $64,000. The company incurred overhead costs of
$122,800 while operating at a volume of 40,000 units. The total controllable cost variance is:
A) $1,200 favorable.
B) $1,200 unfavorable.
C) $13,200 favorable.
D) $13,200 unfavorable.
E) $15,200 favorable.