Chapter 10 Standard Costs and Variances
Jardell Corporation makes a product with the following standards for labor and variable
overhead:
The company budgeted for production of 6,400 units in June, but actual production was 6,400
units. The company used 3,180 direct labor-hours to produce this output. The actual variable
overhead rate was $4.90 per hour. The company applies variable overhead on the basis of
direct labor-hours.
152. The variable overhead efficiency variance for June is:
Chapter 10 Standard Costs and Variances
153. The variable overhead rate variance for June is:
Schuetz Corporation makes a product whose variable overhead standards are based on direct
labor-hours. The quantity standard is 0.4 hours per unit. The variable overhead rate standard is
$5.00 per hour. In July the company produced 7,500 units using 2,740 direct labor-hours. The
actual variable overhead rate was $5.20 per hour.
154. The variable overhead efficiency variance for July is:
Chapter 10 Standard Costs and Variances
10-107
155. The variable overhead rate variance for July is:
Mazzo Corporation makes a product with the following standards for direct labor and
variable overhead:
In February the company’s budgeted production was 5,000 units, but the actual production
was 5,100 units. The company used 2,090 direct labor-hours to produce this output. The
actual variable overhead cost was $6,688. The company applies variable overhead on the
basis of direct labor-hours.
Chapter 10 Standard Costs and Variances
156. The variable overhead efficiency variance for February is:
157. The variable overhead rate variance for February is:
Chapter 10 Standard Costs and Variances
Marten Corporation makes a product with the following standards for direct labor and
variable overhead:
In May the company produced 2,800 units using 300 direct labor-hours. The actual variable
overhead cost was $1,620. The company applies variable overhead on the basis of direct
labor-hours.
158. The variable overhead efficiency variance for May is:
Chapter 10 Standard Costs and Variances
10-110
159. The variable overhead rate variance for May is:
Essay Questions
Chapter 10 Standard Costs and Variances
10-111
160. Thompson Company uses a standard cost system for its single product. The following
data are available:
Actual experience for the current year:
Standards per unit of product:
Required:
Compute the following variances for raw materials, direct labor, and variable overhead,
assuming that the price variance for materials is recognized at point of purchase:
a. Direct materials price variance.
b. Direct materials quantity variance.
c. Direct labor rate variance.
d. Direct labor efficiency variance.
e. Variable overhead rate variance.
f. Variable overhead efficiency variance.
Chapter 10 Standard Costs and Variances
Chapter 10 Standard Costs and Variances
10-113
161. Fastic Corporation makes a product with the following standard costs:
The company reported the following results concerning this product in August.
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 direct labor rate variance.
e. Compute the variable overhead efficiency variance.
f. Compute the variable overhead rate variance.
Chapter 10 Standard Costs and Variances
Chapter 10 Standard Costs and Variances
10-115
162. Blomdahl Corporation makes a product with the following standard costs:
The company reported the following results concerning this product in October.
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 direct labor rate variance.
e. Compute the variable overhead efficiency variance.
f. Compute the variable overhead rate variance.
Chapter 10 Standard Costs and Variances
Chapter 10 Standard Costs and Variances
10-117
163. Silmon Corporation makes a product with the following standard costs:
In June the company produced 4,200 units using 21,830 grams of the direct material and
2,580 direct labor-hours. During the month the company purchased 24,100 grams of the direct
material at a price of $6.80 per gram. The actual direct labor rate was $14.60 per hour and the
actual variable overhead rate was $3.90 per hour. The materials price variance is computed
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 direct labor rate variance.
e. Compute the variable overhead efficiency variance.
f. Compute the variable overhead rate variance.
Chapter 10 Standard Costs and Variances
Chapter 10 Standard Costs and Variances
10-119
164. Igel Corporation makes a product with the following standard costs:
The company reported the following results concerning this product in September.
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 direct labor rate variance.
e. Compute the variable overhead efficiency variance.
f. Compute the variable overhead rate variance.
Chapter 10 Standard Costs and Variances
Chapter 10 Standard Costs and Variances
10-121
165. Schlager Corporation makes a product with the following standard costs:
The company reported the following results concerning this product in August.
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 direct labor rate variance.
e. Compute the variable overhead efficiency variance.
f. Compute the variable overhead rate variance.
Chapter 10 Standard Costs and Variances