Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN: 9781305970663
Author: Don R. Hansen, Maryanne M. Mowen
Publisher: Cengage Learning
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Chapter 9, Problem 35P
Refer to the data in Problem 9.34. Vet-Pro, Inc., also uses two different types of direct labor in producing the anti-anxiety mixture: mixing and drum-filling labor (the completed product is placed into 50-gallon drums). For each batch of 20,000 gallons of direct materials input, the following standards have been developed for direct labor:
The actual direct labor hours used for the output produced in March are also provided:
Required:
- 1. Compute the direct labor mix and yield variances. (Round standard price of yield to four significant digits.)
- 2. Compute the total direct labor efficiency variance. Show that the total direct labor efficiency variance is equal to the sum of the direct labor mix and yield variances.
Vet-Pro, Inc., produces a veterinary grade anti-anxiety mixture for pets with behavioral problems. Two chemical solutions, Aranol and Lendyl, are mixed and heated to produce a chemical that is sold to companies that produce the anti-anxiety pills. The mixture is produced in batches and has the following standards:
During March, the following actual production information was provided:
Required:
- 1. Compute the direct materials mix and yield variances.
- 2. Compute the total direct materials usage variance for Aranol and Lendyl. Show that the total direct materials usage variance is equal to the sum of the direct materials mix and yield variances.
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Grand Display is a manufacturer of large flower pots for urban settings. The company has these standards:
(Click the icon to view the standards.) (Click the icon to view the actual results.)
Read the requirements.
Requirement 1. Compute the direct labor rate variance and the direct labor efficiency variance. (Enter the variances as positive numbers. Enter the currency amounts in the formulas to the nearest cent, then round the final variance amounts to the
nearest whole dollar. Label the variance as favorable (F) or unfavorable (U). Abbreviations used: DL= Direct labor)
Begin with the direct labor rate variance. First determine the formula for the rate variance, then compute the rate variance for direct labor.
DL rate variance
x (
x (
)
Requirements
1. Compute the direct labor rate variance and the direct labor efficiency variance.
2. What is the total variance for direct labor?
3. Who is generally responsible for each variance?
4. Interpret the variances.
Print
- X
Done
Moore Hardware mass produces hardware products such as hammers, screwdrivers, etc. They have a one process production method, and utilize a process costing system to track manufacturing costs. Additionally, they apply manufacturing overhead using a traditional allocation method. The POHR for the year was calculated at $22 per machine hour.
The beginning work in progress account had 9,780 physical units, and a balance of $165,800. During the period they began working on an additional 14,500 units. The following amounts were incurred during the production of the new units:
$89,600 in direct materials
$139,800 in direct labor
3,000 actual machine hours
At the end of the period, 6,770 units were completed and transferred out. The units remaining in progress were 80% complete.
Using the information provided, please calculate the costs transferred to finished goods.
The following information is provided for Space Antenna Corp., which manufactures two products: Lo-Gain antennas and Hi-Gain antennas for use in remote areas.
E (Click the icon to view the information.)
Space Antenna plans to produce 50 Lo-Gain antennas and 325 Hi-Gain antennas.
Read the requirements.
Requirement 1. Compute the indirect manufacturing cost per unit using direct labor hours for the single plantwide predetermined overhead allocation rate.
First, compute the predetermined overhead (OH) allocation rate. (Round your answer to the nearest cent.)
The predetermined overhead (OH) allocation rate is
- X
Data Table
Activity
Cost
Allocation Base
Setup
51,000 Number of setups
42,000 Number of machine hours
Machine maintenance
%24
Total indirect manufacturing costs
93,000
Lo-Gain
Hi-Gain
Total
Direct labor hours
1,600
4,400
6,000
Number of setups
20
20
40
Number of machine hours
3,500
1,500
5,000
Print
Done
Chapter 9 Solutions
Cornerstones of Cost Management (Cornerstones Series)
Ch. 9 - Discuss the difference between budgets and...Ch. 9 - What is the quantity decision? The pricing...Ch. 9 - Why is historical experience often a poor basis...Ch. 9 - Prob. 4DQCh. 9 - How does standard costing improve the control...Ch. 9 - The budget variance for variable production costs...Ch. 9 - Explain why the direct materials price variance is...Ch. 9 - The direct materials usage variance is always the...Ch. 9 - The direct labor rate variance is never...Ch. 9 - Prob. 10DQ
Ch. 9 - Prob. 11DQCh. 9 - What is the cause of an unfavorable volume...Ch. 9 - Prob. 13DQCh. 9 - Explain how the two-, three-, and four-variance...Ch. 9 - Prob. 15DQCh. 9 - Prob. 1CECh. 9 - Direct Materials Usage Variance Refer to...Ch. 9 - Refer to Cornerstone Exercise 9.1. Guillermos Oil...Ch. 9 - Kavallia Company set a standard cost for one item...Ch. 9 - Yohan Company has the following balances in its...Ch. 9 - Standish Company manufactures consumer products...Ch. 9 - Variances Refer to Cornerstone Exercise 9.6....Ch. 9 - Standish Company manufactures consumer products...Ch. 9 - Mangia Pizza Company makes frozen pizzas that are...Ch. 9 - Mangia Pizza Company makes frozen pizzas that are...Ch. 9 - Refer to Cornerstone Exercise 9.9. Required: 1....Ch. 9 - Quincy Farms is a producer of items made from farm...Ch. 9 - During the year, Dorner Company produced 280,000...Ch. 9 - Zoller Company produces a dark chocolate candy...Ch. 9 - Oerstman, Inc., uses a standard costing system and...Ch. 9 - Refer to the data in Exercise 9.15. Required: 1....Ch. 9 - Chypre, Inc., produces a cologne mist using a...Ch. 9 - Refer to Exercise 9.17. Chypre, Inc., purchased...Ch. 9 - Delano Company uses two types of direct labor for...Ch. 9 - Jameson Company produces paper towels. The company...Ch. 9 - Madison Company uses the following rule to...Ch. 9 - Laughlin, Inc., uses a standard costing system....Ch. 9 - Responsibility for the materials price variance...Ch. 9 - Which of the following is true concerning labor...Ch. 9 - A company uses a standard costing system. At the...Ch. 9 - Relevant information for direct labor is as...Ch. 9 - Which of the following is the most likely...Ch. 9 - Haversham Corporation produces dress shirts. The...Ch. 9 - Plimpton Company produces countertop ovens....Ch. 9 - Algers Company produces dry fertilizer. At the...Ch. 9 - Misterio Company uses a standard costing system....Ch. 9 - Petrillo Company produces engine parts for large...Ch. 9 - Business Specialty, Inc., manufactures two...Ch. 9 - Vet-Pro, Inc., produces a veterinary grade...Ch. 9 - Refer to the data in Problem 9.34. Vet-Pro, Inc.,...Ch. 9 - Energy Products Company produces a gasoline...Ch. 9 - Nuevo Company produces a single product. Nuevo...Ch. 9 - Ingles Company manufactures external hard drives....Ch. 9 - As part of its cost control program, Tracer...Ch. 9 - Aspen Medical Laboratory performs comprehensive...Ch. 9 - Leather Works is a family-owned maker of leather...
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