Expenses:
Faculty wages ($2,400q2)
331,200
Course supplies ($69q1 +$46q2)
103,638
Administrative expenses ($33,100
+$15q1 +$33q2)
58,804
8-1042
401.
Sonner Tech is a for-profit vocational school. The school bases its budgets on two
measures of activity (i.e., cost drivers), namely student and course. The school uses the
following data in its budgeting:
Fixed element
per month
Variable element
per course
Revenue
$0
$0
Faculty wages
$0
$2,900
Course supplies
$0
$13
Administrative
expenses
$64,400
$35
Actual students (q1)
Actual courses (q2)
Revenue ($454q1)
In September, the school budgeted for 1,760 students and 156 courses. The actual
activity for the month was 1,560 students and 153 courses.
Required:
Prepare the school’s flexible budget for the actual level of activity in September.
8-1043
8-1044
402.
The standards for product K17 call for 5.0 meters of a raw material that costs $19.10 per
meter. Last month, 2,700 meters of the raw material were purchased for $51,435. The
actual output of the month was 460 units of product K17. A total of 2,500 meters of the
raw material were used to produce this output.
The direct materials purchases variance is computed when the materials are purchased.
Required:
a. What is the materials price variance for the month?
b. What is the materials quantity variance for the month?
8-1045
403.
The following standards have been established for a raw material used to make product
I92:
Standard quantity of the material per unit of output
4.5
pounds
Standard price of the material
$13.90
per pound
The following data pertain to a recent month’s operations:
Actual material purchased
2,000
pounds
Actual cost of material purchased
$26,200
Actual material used in production
1,300
pounds
Actual output
220
units of product I92
The direct materials purchases variance is computed when the materials are purchased.
Required:
a. What is the materials price variance for the month?
b. What is the materials quantity variance for the month?
8-1046
404.
Sizzle Company uses a standard cost system to collect costs related to the production of
its “No-Stick” lawn chairs. The direct material for the chairs is teflon. Sizzle uses a
standard direct material cost of $40.00 per chair (0.8 pounds of teflon × $50.00 per
pound). During April, Sizzle purchased 2,100 pounds of teflon for $106,575. Sizzle used
1,750 pounds of this teflon in April to produce 1,800 lawn chairs.
Required:
Calculate Sizzle’s materials price and materials quantity variances for April.
8-1047
405.
The following materials standards have been established for a particular product:
Standard quantity per unit of output
9.2
grams
Standard price
$14.70
per gram
The following data pertain to operations concerning the product for the last month:
Actual materials purchased
5,500
grams
Actual cost of materials purchased
$76,450
Actual materials used in production
5,100
grams
Actual output
540
units
The direct materials purchases variance is computed when the materials are purchased.
Required:
a. What is the materials price variance for the month?
b. What is the materials quantity variance for the month?
8-1048
8-1049
406.
Zee Corporation has developed the following cost standards for the production of its
leather backpacks:
Standard Cost Per
Backpack
Leather (0.9 yards × $22 per yard)
$19.80
Direct labor (1.3 hours × $9.00 per hour)
$11.70
Variable overhead (1.3 hours × $15.00 per
hour)
$19.50
Variable overhead at Zee is applied on the basis of direct labor hours. The actual results
for last month were as follows:
Number of backpacks
produced
15,000
Direct labor hours incurred
18,800
Yards of leather purchased
14,500
Yards of leather used in
production
14,100
Cost of leather purchased
$306,675
Direct labor cost
$159,800
Variable overhead cost
$285,760
The direct materials purchases variance is computed when the materials are purchased.
Required:
Compute the following variances for Zee.
a. Materials price variance.
b. Materials quantity variance.
c. Labor efficiency variance.
d. Variable overhead rate variance.
8-1050
8-1051
407.
Rardin Corporation makes a product with the following standard costs:
Standard
Quantity
or Hours
Standard
Price or
Rate
Direct
materials
7.4
ounces
$8.00 per
ounce
Direct
labor
0.3 hours
$16.00
per hour
Variable
overhead
0.3 hours
$7.00 per
hour
The company reported the following results concerning this product in July.
Actual output
2,200
units
Raw materials used in production
16,420
ounces
Purchases of raw materials
17,900
ounces
Actual direct labor-hours
720
hours
Actual cost of raw materials purchases
$141,410
Actual direct labor cost
$12,528
Actual variable overhead cost
$5,112
The company applies variable overhead on the basis of direct labor-hours. The direct
materials purchases variance is computed when the materials are purchased.
Required:
a. Compute the materials quantity variance.
b. Compute the materials price variance.
c. Compute the labor efficiency variance.
d. Compute the labor rate variance.
8-1052
e. Compute the variable overhead efficiency variance.
f. Compute the variable overhead rate variance.
8-1053
8-1054
408.
Graybeal Corporation makes a product with the following standard costs:
Standard Quantity or Hours
Standard Price or Rate
Direct materials
4.3 ounces
$6.00 per ounce
Direct labor
0.7 hours
$21.00 per hour
Variable overhead
0.7 hours
$7.00 per hour
The company reported the following results concerning this product in March.
Actual output
3,500
units
Raw materials used in production
14,710
ounces
Actual direct labor-hours
2,270
hours
Purchases of raw materials
16,700
ounces
Actual price of raw materials
$5.80
per ounce
Actual direct labor rate
$21.90
per hour
Actual variable overhead rate
$7.30
per hour
The materials price variance is recognized when materials are purchased. Variable
overhead is applied on the basis of direct labor-hours.
Required:
a. Compute the materials quantity variance.
b. Compute the materials price variance.
c. Compute the labor efficiency variance.
d. Compute the labor rate variance.
e. Compute the variable overhead efficiency variance.
f. Compute the variable overhead rate variance.
8-1055
8-1056
409.
Smyer Corporation makes a product with the following standard costs:
Standard
Quantity
or Hours
Standard
Price or
Rate
Standard
Cost Per
Unit
Direct
materials
7.1
pounds
$5.00 per
pound
$35.50
Direct
labor
0.8 hours
$17.00
per hour
$13.60
Variable
overhead
0.8 hours
$7.00 per
hour
$5.60
The company reported the following results concerning this product in July.
Originally budgeted output
4,700
units
Actual output
4,500
units
Raw materials used in production
34,150
pounds
Actual direct labor-hours
3,610
hours
Purchases of raw materials
36,500
pounds
Actual price of raw materials
$5.10
per pound
Actual direct labor rate
$18.10
per hour
Actual variable overhead rate
$6.70
per hour
The materials price variance is recognized when materials are purchased. Variable
overhead is applied on the basis of direct labor-hours.
Required:
a. Compute the materials quantity variance.
b. Compute the materials price variance.
c. Compute the labor efficiency variance.
8-1057
d. Compute the labor rate variance.
e. Compute the variable overhead efficiency variance.
f. Compute the variable overhead rate variance.
8-1058
8-1059
410.
Moates Corporation makes a product with the following standard costs:
Standard
Quantity
or Hours
Standard
Price or
Rate
Direct
materials
6.5 kilos
$1.00 per
kilo
Direct
labor
0.2 hours
$21.00
per hour
Variable
overhead
0.2 hours
$7.00 per
hour
In January the company produced 5,800 units using 38,740 kilos of the direct material and
1,110 direct labor-hours. During the month, the company purchased 41,000 kilos of the
direct material at a total cost of $49,200. The actual direct labor cost for the month was
$20,979 and the actual variable overhead cost was $6,993. The company applies variable
overhead on the basis of direct labor-hours. The direct materials purchases variance is
computed when the materials are purchased.
Required:
a. Compute the materials quantity variance.
b. Compute the materials price variance.
c. Compute the labor efficiency variance.
d. Compute the labor rate variance.
e. Compute the variable overhead efficiency variance.
f. Compute the variable overhead rate variance.