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Exam 29: Controlling Manufacturing Costs: Standard Costs

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Question 21

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The labor standard for a product was 5.5 hours at a wage rate of $9 per hour. The firm produced 1,020 units of the item. Labor costs totaled $50,414 and 5,540 hours of labor were used. An analysis of labor costs would indicate

A) a $554 favorable labor time variance.
B) a $554 unfavorable labor time variance.
C) a $630 unfavorable labor rate variance.
D) a $630 favorable labor rate variance.

E) B) and C)
F) A) and D)

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Question 22

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Determine the cost behavior for each of the following items as Fixed (F), Variable (V), or Semi-variable (S). Production Level

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(1) F, (2) V, (3) V,...

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Question 23

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The purchasing department can determine the standard quantity per unit of each type of raw material required to manufacture a product.

Costs that vary in some degree with the volume of activity, but not in direct proportion to it are called----------- costs.

A price variance for an item is the difference between its actual price and its standard price multiplied by the standard quantity.

Efficiency and cost control can be evaluated by comparing actual overhead costs with the budget for the actual level of operations with the

The company's accountant developed the data given below for Product X for the year 2019. Use this information to calculate the answers to the questions that follow. Total budgeted production: 10,000 units Raw materials: 5 units of raw materials, costing $1.75 per unit, required for each unit of finished goods Direct labor: 4 hours of labor at the rate of $12 per hour required for each unit of finished goods Mfg. overhead: $70,000 budgeted for 10,000 units of finished goods 1. What is the standard cost per unit of product for materials? 2. What is the standard cost per unit of product for labor? 3. What is the standard cost per unit of product for overhead? 4. What is the total standard cost per unit of product?

Petersen Company produces a single product with the following production and average cost data: - The best estimate of total cost at an activity level of 7,250 units is:

A flexible budget shows budgeted costs at several different levels of activity.

The difference between the total standard cost and the total actual cost is the----------- .

A budget that shows expected costs at more than one level of activity is called a(n)----------budget.

Which variance is controllable by the purchasing manager?

Which of the following costs are generally semi-variable?

Vista Company's records show the following information for the first six months of 2019. 1. What are the variable costs per hour using the high-low point method? 2. What are the fixed costs per month using the high-low point method?

The price variance for an item is the difference between its actual price and its standard price, multiplied by the--------- quantity.

In a factory, the fixed costs per unit are $60 when 500 units are produced. If 600 units are produced, the fixed costs per unit would be

Match the following descriptions with the appropriate term.

Complete the flexible budget of manufacturing costs for Lansome Industries for September 2019. Overhead is based on direct labor hours. Lansome Industries Budget of Manufacturing Costs Month of September 2019 $\begin{array}{|c|l|l|r|}\hline \text { Depreciation } & (19) & \underline{1,750} & \underline{(20)} \\\hline \text { Total fixed costs } & (21) & \underline{(22)} & \underline{6,235} \\\hline \text { Total manufacturing overhead } & (23) & (24) & \underline{11,985} \\\hline\end{array}$

Weaver Corporation has a three-year contract with a security firm that sets hourly wage rates for the firm at $10 per hour. At 7,000 units of output, factory security costs were $14,000. Production is expected to increase next year to a level of 10,000 units and the security costs are expected to remain the same. The security costs are an example of fixed factory costs.

The standard costs for a unit of product are shown below. $\begin{array} { l l r } \text { Materials: } & 2 \text { pounds at } \$ 1.00 \text { per pound } & \$ 2.00 \\\text { Labor: } & 1 \text { hours at } \$ 10.00 \text { per hour } & 10.00 \\\text { Overhead: } & 60 \% \text { of directlabor } & 6.00\end{array}$ During June, Job N-5 for 100 units was completed. The actual costs of the job are shown below. $\begin{array}{llll}\text { Materials: } & 300 &\text { pounds at } \$ 1.45 \text { per pound } & \$ 435.00 \\\text { Labor: } & 200& \text { hours at } \$ 9.50 \text { per hour } & 1,900 \\\text { Overhead Applied: } & 60 \% &\text { of direct labor } & 1,140\end{array}$ 1. What is the total cost variance between actual cost and standard cost? 2. What is the total material variance? 3. What is the material quantity variance? 4. What is the material price variance?