Log in

View Full Version : Accounting


javabha
Nov 21, 2010, 06:11 PM
1.Lido Company's standard and actual costs per unit for the most recent period, during which 500 units were actually produced, are given below:

Standard Actual
Materials:
Standard: 2 feet at $1.50 per foot $ 3.00
Actual: 1.9 feet at $1.60 per foot $ 3.04
Direct labor:
Standard: 1.5 hours at $6.00 per hour 9.00
Actual: 1.7 hours at $6.30 per hour 10.71
Variable manufacturing overhead:
Standard: 1.5 hours at $3.40 per hour 5.10
Actual: 1.7 hours at $3.00 per hour 5.10
Total unit cost $17.10 $18.85

All of the material purchased during the period was used in production during the period.

Required:

From the foregoing information, compute the following variances. Indicate whether the variance is favorable (F) or unfavorable (U):
a. Material price variance.
b. Material quantity variance.
c. Direct labor rate variance.
d. Direct labor efficiency variance.
e. Variable overhead spending variance.
f. Variable overhead efficiency variance

pready
Nov 21, 2010, 06:28 PM
So what is your question, or do you just want someone to do your homework for you.

rehmanvohra
Nov 23, 2010, 12:02 AM
We can not solve the problem for you but we can guide you to do it.

a. Material price variance.
(Standard Rate - Actual Rate) x Actual Quantity used
b. Material quantity variance.
(Standard Quantity Allowed - Actual Quantity Used) x Standard Rate
c. Direct labor rate variance.
(Standard Rate - Actual Rate) x Actual hours worked
d. Direct labor efficiency variance.
(Standard Hours allowed - Actual hours worked) x Standard Rate
e. Variable overhead spending variance.
Budgeted allowance for capacity attained - Actual variable overheads
f. Variable overhead efficiency variance
(Standard Hours allowed - Actual hours worked) x Standard Variable Overhead Rate