1 answer

Can you please explain why it favorable and unfavorable. thank you. P 9-A Variance Analysis (In...

Question:

P 9-A Variance Analysis (In Class) Pear Company is a manufacturing firm that specializes in the production of a single produc

Can you please explain why it favorable and unfavorable. thank you.
P 9-A Variance Analysis (In Class) Pear Company is a manufacturing firm that specializes in the production of a single product. Overhead is applied based on direct labor hours. Standard Cost Card (budget for one unit) The standard cost card shows the manager what the final manufactured cost should be for the company's product. Standard Standard Quantity Price Standard or Hours or Rate Cost Direct Materials 3.5 feet х $ 6 $ 21 Direct labor 2.0 hours х 18 36 Variable overhead 2.0 hours X 4 8 Total standard cost per suit $ 65 5,000 $108,000 Variance Analysis - A variance is the difference between standard price and quantities, and actual prices and quantities. The following actual production data is available: Number of products completed Cost of materials purchased (20,000 feet @ $5.40) Feet of material used 20,000 Cost of direct labor (10,500 hours @ $20) $210,000 Cost of variable overhead 40,950 Compute the following: Material price variance Material quantity variance Labor rate variance Labor efficiency variance Variable overhead rate variance

Answers

Material price variance =(standard cost per unit - actual cost per unit )*actual quantity purchased

( $6 - $5.40)* 20000= F $12000

The actual price is lower than the estimated standard price hence there is a reduction in cost and therefore it is profitable.

Material Quantity Variance = (standard quantity - actual quantity) * standard price

= ( $17500 -$ 20000)*$6 = A $15000

The actual quantity of material used for the production is more than the standard for the same level of production and hence it is adverse in nature.

Labour rate variance = (standard rate per hr- actual rate per hour ) * actual hours

( 18 - 20)* 10500 = A 21,000

The actual labour rate charged by the labour is higher than the standard rate set,it increases the labour cost per hour and hence it is adverse in nature.

Labour effeciency variance =(standard hours allowed - actual hours worked)*standard rate

= ( 10000-10500)* 18 = A 9000

There is reduction in the efficiency of labourers in comparison to the standard set the labours are taking 500 hours more to complete the job and hence it is unfavourable/adverse.

Variable overheads rate variance = (standard rate per hour - actual rate per hour )* actual hours

( $4 - $ 3.9)* 10500=F 1050

The actual standard rate per hour is less that the standard set and hence there is a reduction in cost and it is favourable

.

Similar Solved Questions

1 answer
Danny is a full-term infant who was born via an emergency cesarean section for a placental...
Danny is a full-term infant who was born via an emergency cesarean section for a placental abruption. Danny’s 15-year-old mother, Karla, admitted to having used “some cocaine” during her pregnancy. Karla has been discharged home but Danny is still in the hospital awaiting clearance...
1 answer
Collection of a $2800 Accounts Receivable increases an asset $2800; decreases a liability $2800. decreases a...
Collection of a $2800 Accounts Receivable increases an asset $2800; decreases a liability $2800. decreases a liability $2800; increases stockholders' equity $2800. increases an asset $2800; decreases an asset $2800. decreases an asset $2800; decreases a liability $2800. Save for Later 80...
1 answer
Cheek the answer plz Solve this Aggregate Planning Problem by minimizing the cost of matching the...
cheek the answer plz Solve this Aggregate Planning Problem by minimizing the cost of matching the capacity various options in various periods to the future demand? Find inventory cost, regular time cost, overtime cost and subcontract cost, and the total cost? Sales Period Mar Apr May Pemand 700 1000...
1 answer
In many poor countries, even middle-class families may have full-time servants, a luxury reserved for only...
In many poor countries, even middle-class families may have full-time servants, a luxury reserved for only the very wealthiest households in rich countries like the United States. The existence of low-cost domestic help in poor countries makes the PPP adjusted GDP statistics in those countries: lowe...
1 answer
Write a program that will find the winner in a skating competition. It will have a...
Write a program that will find the winner in a skating competition. It will have a structure for skater information: name, country, points (array of 10 real numbers), and average. Program will input information of 5 skaters and will find and display the winner by calculating the average point of eac...
1 answer
PREPARED BY: DATE: PROJECT TITLE Deter niae whether each stardemeaxt is t rue or false.efalsey strect...
PREPARED BY: DATE: PROJECT TITLE Deter niae whether each stardemeaxt is t rue or false.efalsey strect it TE) 771ー-ion contains 53 protons and 54 elecho ica clectons...
1 answer
21. Which of the following age groups is at highest risk for suicide? a. School-aged bAdolescent...
21. Which of the following age groups is at highest risk for suicide? a. School-aged bAdolescent c. Middle adult d. Preschoolers...
1 answer
Financial Statements, including Statement of Cash Flows Pendray Systems Corporation began operations on January 1, 2015,...
Financial Statements, including Statement of Cash Flows Pendray Systems Corporation began operations on January 1, 2015, as an online retailer of computer software and hardware. The following financial statement data were taken from Pendray's records at the end of its first year of operations, D...
1 answer
2018. Capulet Corporation does not use reversing entries. P14-2 (L01,2) EXCEL (Issuance and Redemption of Bonds)...
2018. Capulet Corporation does not use reversing entries. P14-2 (L01,2) EXCEL (Issuance and Redemption of Bonds) Venezuela Co. is building a new hockey arena at a cost of 00,000. It received a downpayment of $500,000 from local businesses to support the project, and now needs to borrow $2,000,000 to...
1 answer
Which protons (a-d), if any, experience the same proton environment, and thus overlap on a 1H...
Which protons (a-d), if any, experience the same proton environment, and thus overlap on a 1H NMR spectrum? CH3a Нас -Ho CH3c 10 9 8 7 6 5 4 3 2 ܝܙ 0...
1 answer
As a nurse practitioner how do you view your role in using theory in practice
As a nurse practitioner how do you view your role in using theory in practice...
1 answer
How do you find the inverse of #y=x^3 +5# and is it a function?
How do you find the inverse of #y=x^3 +5# and is it a function?...
1 answer
1) A) " the main, and in itself sufficient, cause of business cycle fluctuations... is the fact that technical and commercial progress... sometimes speeds up and sometimes slows down." (knut W...
1) A) " the main, and in itself sufficient, cause of business cycle fluctuations... is the fact that technical and commercial progress... sometimes speeds up and sometimes slows down." (knut Wicksell) Do you agree? B) Explain what happens when the FED conducts an open-market sale of $300 bil...
1 answer
Research shows that renal calculi is on the rise, what impact can the clinical role of...
Research shows that renal calculi is on the rise, what impact can the clinical role of a nurse practitioner have on this debilitating disease...
1 answer
Question 9: Which of the following circumstances allows for a disparity in pay between different genders?...
Question 9: Which of the following circumstances allows for a disparity in pay between different genders? Answer: A. A seniority system В. A merit system C. A merit system based on quantity or quality of output D. All of these options Question 11: Within the employee earnings record, most colu...
1 answer
Mycobacterium tuberculosis and Listeria monocytogenes are both facultative intracellular parasites in humans. These pathogens have the...
Mycobacterium tuberculosis and Listeria monocytogenes are both facultative intracellular parasites in humans. These pathogens have the ability to grow and multiply inside phagocytes. Artificial passive immunity against these infections can be achieved only by transferring E rosette forming leukocyte...
1 answer
2 doses 3 doses 5 doses QUESTION 41 10 point The pediatric client is ordered procainamide...
2 doses 3 doses 5 doses QUESTION 41 10 point The pediatric client is ordered procainamide hydrochloride (Pronestyn) 3-6 mg/kg to a maximum of 100 mg/dose. What would be a safe dosage for the client who weighs 35 kg? 5.8-11.67 mg 100 mg 105-210 mg 8.6-17.14 mg Save and submit to save and submit. Clic...
1 answer
(4 points) Prove that the fractal dimension of the set 11 1 F = {0,1, U...
(4 points) Prove that the fractal dimension of the set 11 1 F = {0,1, U 4' 9' 16 equals : k=1...
1 answer
In a certain study comma the chances of encountering a car crash on the road are...
In a certain study comma the chances of encountering a car crash on the road are stated as ​"5 in 18​." Express the indicated degree of likelihood as a probability value between 0 and 1 inclusive. What is the  probability? ​(Round to three decimal places as​...
1 answer
Please help i need to get these right in order to get an A PLEASE PLEASE...
Please help i need to get these right in order to get an A PLEASE PLEASE PLEASE 1. What is the Kc for the following reaction at equilibrium at 1000 ∘C if [CO]= 0.50 M , [H2]= 0.32 M , [CH4]= 1.6 M , and [H2O]= 2.8 M ? CO(g)+3H2(g)⇌CH4(g)+H2O(g) 2. The equilibrium constant, Kc, for the re...