The purchasing department buys the quantities of raw materials that are expected to be used in production each month. Rawmaterials inventories, therefore, can be ignored.(a)Compute all of the materials and labor variances.Total materials variance$Materials price variance$Materials quantity variance$Total labor variance$Labor price variance$Labor quantity variance$(b)Compute the total overhead variance.

Step 1: Compute the Materials Price VarianceMaterials Price Variance=(Actual Price−Standard…

Answered: The purchasing department buys the…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter8: Standard Costs And Variances

Section: Chapter Questions

Problem 6EA: Use the information provided to answer the questions. All material purchased was used in production....

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Similar questions

A. Describe the two variances between the actual costs and the standard costs for factory overhead. B. What is a factory overhead cost variance report?
Kamen Manufacturing Co. estimates the following labor and overhead costs for the period: Required: Use the four-variance method for overhead analysis. Calculate the variances for direct labor and overhead. Prove that the overhead variances equal over- or underapplied factory overhead for the period.
Ribcos labor cost information for making its only product for March is as follows: A. What is the direct labor rate variance? B. What is the direct labor time variance? C. What is the total direct labor variance?
Which of the following is true concerning labor variances that are not material in amount? a. They are closed to Cost of Goods Sold. b. They are prorated among Work in Process, Finished Goods, and Cost of Goods Sold. c. They are prorated among Materials, Work in Process, Finished Goods, and Cost of Goods Sold. d. They are reported as part of Overall Variance on the balance sheet at the end of the year.
Mulliner Company showed the following information for the year: Required: 1. Calculate the standard direct labor hours for actual production. 2. Calculate the applied variable overhead. 3. Calculate the total variable overhead variance.
If variances are recorded in the accounts at the time the manufacturing costs are incurred, what does a debit balance in Direct Materials Price Variance represent?
Use the information provided to answer the questions. All material purchased was used in production. A. What is the standard price paid for materials? B. What is the direct materials quantity variance? C. What is the total direct materials cost variance? D. If the direct materials price variance was unfavorable, what would be the standard price?
Rath Company showed the following information for the year: Required: 1. Calculate the standard direct labor hours for actual production. 2. Calculate the applied variable overhead. 3. Calculate the total variable overhead variance.
The fixed factory overhead variance is caused by the difference between which of the following? A. actual and standard allocation base B. actual and budgeted Units C. actual fixed overhead and applied fixed overhead D. actual and standard overhead rates
The materials price variance is usually computed a. when goods are finished. b. when materials are issued to production. c. when materials are purchased. d. after suppliers are paid. e. None of these.
(Appendix 10A) Which of the following is true concerning labor variances that are not material in amount? a. They are closed to Cost of Goods Sold. b. They are prorated among Work in Process, Finished Goods, and Cost of Goods Sold. c. They are prorated among Materials, Work in Process, Finished Goods, and Cost of Goods Sold. d. They are reported on the balance sheet at the end of the year. e. All of these.
Breakaway Companys labor information for May is as follows: A. What is the actual direct labor rate per hour? B. What is the standard direct labor rate per hour? C. What was the total standard direct labor cost for May? D. What was the direct labor rate variance for May?

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