a.
b. =
c. =
PROBLEM 24.9A
ANTON COMPANY
220 stands × 3 square feet per stand = 660 square feet.
45 Minutes, Medium
Since the direct materials quantity variance is $0, the actual quantity of materials used per
stand must equal the budgeted quantity per stand. Thus, the total quantity purchased and
used is:
Standard Hourly Rate × (Standard Hours – Actual Hours)
Labor Efficiency Variance
Labor Rate Variance Actual Labor Hours × (Standard Rate – Actual Rate)
b.
=
=
Standard Price × (Standard Quantity – Actual Quantity)
The materials quantity variance (MQV) is first used to find the standard quantity of material
allowed for producing 1,520 units (MQV is half MPV):
MQV
Thus, we may solve for the Standard Quantity as follows:
SOLUTIONS TO PROBLEMS SET B
25 Minutes, Strong
-$6,400
PROBLEM 24.1B
UNDEM
$40/lb – (Standard Quantity – 3,200 pounds)
PROBLEM 24.2B
DYELOT INDUSTRIES
a.
MPV =
30 Minutes, Medium
Computation of materials price variance (MPV):
Actual Quantity Used × (Standard Price – Actual Price)
PROBLEM 24.2B
DYELOT INDUSTRIES (concluded)
Computation of overhead spending variance:
Overhead budgeted for 400 batches:
Fixed 150,000$
V
ariable (400 batches × $20 per batch) 8,000
b. General Journal
Standard cost (400 batches × $800) = $320,000
Actual cost = $307,500
To record direct labor cost applicable to Januar
y
production:
Standard cost (400 batches × $160) = $64,000
Actual cost = $62,010
To apply overhead to work in process, using
standard unit cost:
25 Minutes, Medium PROBLEM 24.3B
LATIN SILK PRODUCTS
a.
(1) Work in Process (standard cost) 100,000
Materials Quantity Variance 10,000
(2) Work in Process (standard cost) 94,000
Labor Efficiency Variance 8,000
To record manufacturing overhead assigned to
production, and to record overhead variances.
To transfer cost of units completed to finished goods
inventory, 20,000 units at $15 per unit.
To record cost of units sold, 18,000 units at $15 per unit.
a. =
=
=
=
=
b. =
=
=
=
=
=
45 Minutes, Strong
Materials Price Variance Actual Quantity Used × (Standard Price – Actual Price)
170,000 pounds × ($5.00 – $4.80*)
PROBLEM 24.4B
HANS ENTERPRISES
Labor Efficiency Variance Standard Hourly Rate × (Standard Hours – Actual
Hours)
$8.25 per hour × (2,400 hours* – 2,500 hours)
Labor Rate Variance Actual Labor Hours × (Standard Rate – Actual Rate)
2,500 hours × ($8.25 – $8.00*)
Materials Quantity Variance Standard Price × (Standard Quantity – Actual
Quantity)
*Actual Rate per Hour = $20,000/2,500 hours = $8.00/hour
-$825 Unfavorable
$625 Favorable
$30,000 Unfavorable
*Standard Quantity Allowed = 160 batches × 1,025 pounds/batch = 164,000 pounds
$5.00 per pound × (164,000 pounds* – 170,000
pounds)
c.
Overhead
Costs Applied
PROBLEM 24.4B
HANS ENTERPRISES (continued)
Overhead variances:
Actual Overhead
Costs Incurred
Costs Allowed
Standard Overhead
g
.
844,920 844,920*
PROBLEM 24.4B
HANS ENTERPRISES (concluded)
Entry to transfer the 160 batches of crow bait produced in June to finished goods:
Finished Goods Inventory (at standard cost) …………………………
a. =
=
=
=
b. =
$1.32 per gallon × (30,000 gallons* – 34,000 gallons)
Actual Labor Hours × (Standard Rate – Actual Rate)
-$5,280 (or $5,280 Unfavorable)
*Standard Quantity Allowed = 10,000 cases × 3.0 gallons/case = 30,000 gallons
Labor Rate Variance
Quantity)
45 Minutes, Strong
Actual Quantity Used × (Standard Price – Actual Price)
34,000 gallons × ($1.32 – $1.28*)
Materials Price Variance
PROBLEM 24.5B
SMOOTH CORPORATION
c.
d. (1) 39,600 *
5,280
…
(3) 21,200
52
…
…
116,200
Direct Labor (at actual cost) ………………………………………………
…
Work in Process Inventory (at standard cost) …………………
…
To record the cost of direct labor charged to production.
*10,000 actual cases × 0.80 hours allowed per case × $15 per hour = $120,000
Overhead Volume Variance (unfavorable) ……………………
…
…
8,300Labor Rate Variance (favorable) …………………………………………
…
Materials Price Variance (favorable) …………………………………
…
43,520
1,360
Direct Materials Inventory (at actual cost) ……………………………
Costs Applied
Actual Overhead
Costs Incurred Standard Overhead
Work in Process Inventory (at standard cost) ……………
…
Materials Quantity Variance (unfavorable) ………………
…
*Standard Variable Overhead Allowed = $1.60/case × 10,000 cases = $16,000
PROBLEM 24.5B
SMOOTH CORPORATION (concluded)
Overhead variances:
Overhead