Chapters 10 & 11 Demonstration Problem Solutions Page 1 Please send comments and corrections to me at [email protected] Demo 10/11-1 ANSWER Actual Cost Mixed Flexible Budget AP X AQ SP X AQ SP X SQ $4.90 X 4200 $5.20 X 4200 $5.20 X 4000 $20,580 |_________ $21,840 ________________| |________________ $20,800 ________| (-) Material Price Variance (-) Material Usage Variance -$1,260 F $1,040 U Actual Cost Mixed Flexible Budget AP X AQ SP X AQ SP X SQ $9.30 X 5700 $9.50 X 5700 $9.50 X 6000 $53,010 |_________ $54,150 ________________| |________________ $57,000 ________| (-) Labor Rate Variance (-) Labor Efficiency Variance -$1,140 F -$2,850 F Demo 10/11-2 ANSWER Actual Cost Mixed Flexible Budget AP X AQ SP X AQ SP X SQ $4.00 X 7,500 $4.00 X 7,200 (2 x 3,600) $31,500 |_________ $30,000 _____________| |______________ $28,800 __________| (-) Variable Overhead Spending Variance (-) Variable Overhead Efficiency Variance $1,500 U $1,200 U Actual Cost Fixed Overhead Static Budget Standard AP X AQ SP X SQ $7.00 X 7,200 (2 x 3,600) $51,600 |_________ $56,000 ________________| |______________ $50,400 ________| (-) Fixed Overhead Budget Variance (-) Fixed Overhead Volume Variance -$4,400 F $5,600 UChapters 10 & 11 Demonstration Problem Solutions Page 2 Please send comments and corrections to me at [email protected] Demo 10/11-3 ANSWER a. Direct Materials variances: Actual Cost Mixed Flexible Budget AP X AQ SP X AQ SP X SQ $2.00 X 38,000 $2.20 X 38,000 $2.20 X 36,000 (4x9000) $76,000 |_________ $83,600 _______________| |______________ $79,200 __________| (-) Material Price Variance (-) Material Usage Variance -$7,600 F $4,400 U b. Direct Labor variances: Actual Cost Mixed Flexible Budget AP X AQ SP X AQ SP X SQ $11.30 X 18,500 $11.00 X 18,500 $11.00 X 18,000 (2x9,000) $209,050 |_________ $203,500 _____________| |______________ $198,000 __________| (-) Labor Rate Variance (-) Labor Efficiency Variance $5,550 U $5,500 U c. Variable Manufacturing Overhead variances: Actual Cost Mixed Flexible Budget AP X AQ SP X AQ SP X SQ $3.00 X 18,500 $3.00 X 18,000 (2 x 9,000) $54,900 |_________ $55,500 _____________| |______________ $54,000 __________| (-) Variable Overhead Spending Variance (-) Variable Overhead Efficiency Variance -$600 F $1,500 UChapters 10 & 11 Demonstration Problem Solutions Page 3 Please send comments and corrections to me at [email protected] d. Fixed Manufacturing Overhead variances: Actual Cost Fixed Overhead Static Budget Standard AP X AQ SP X SQ $2.50 X 18,000 (2 x 9,000) $52,000 |_________ $50,000 ______________| |_____________ $45,000 __________| (-) Fixed Overhead Budget Variance (-) Fixed Overhead Volume Variance $2,000 U $5,000 U Demo 10/11-4 ANSWER a. Direct Materials variances: Actual Cost Mixed Flexible Budget AP X AQ SP X AQ SP X SQ $9.40 X 3,000 $9.00 X 3,000 $9.00 X 2,700 (.6x4,500) $28,200 |_________ $27,000 _______________| |______________ $24,300 _________| (-) Material Price Variance (-) Material Usage Variance $1,200 U $2,700 U b. Direct Labor variances: Actual Cost Mixed Flexible Budget AP X AQ SP X AQ SP X SQ $12.50 X 3,800 $12.80 X 3,800 $12.80 X 3,600 (.8x4,500) $47,500 |_________ $48,640 _____________| |______________ $46,080 __________| (-) Labor Rate Variance (-) Labor Efficiency Variance -$1,140 F $2,560 UChapters 10 & 11 Demonstration Problem Solutions Page 4 Please send comments and corrections to me at [email protected] c. Variable Manufacturing Overhead variances: Actual Cost Mixed Flexible Budget AP X AQ SP X AQ SP X SQ $7.50 X 3,800 $7.50 X 3,600 (.8 x 4,500) $30,100 |_________ $28,500 _____________| |______________ $27,000 __________| (-) Variable Overhead Spending Variance (-) Variable Overhead Efficiency Variance $1,600 U $1,500 U d. Fixed Manufacturing Overhead variances: Actual Cost Fixed Overhead Static Budget Standard AP X AQ SP X SQ $22.50 X 3,600 (.8 x 4,500) $88,700 |_________ $90,000 ______________| |____________ $81,000 __________| (-) Fixed Overhead Budget Variance (-) Fixed Overhead Volume Variance -$1,300 F $9,000 U Demo 10/11-5 ANSWER a. Direct Material variances: Actual Cost Mixed Flexible Budget AP X AQ SP X AQ SP X SQ $2.20 X 6,400 $2.00 X 6,400 $2.00 X 6,000 (3x2,000) $14,080 |_________ $12,800 _______________| |______________ $12,000 _________| (-) Material Price Variance (-) Material Usage Variance $1,280 U $800 UChapters 10 & 11 Demonstration Problem Solutions Page 5 Please send comments and corrections to me at [email protected] b. Direct Labor variances: Actual Cost Mixed Flexible Budget AP X AQ SP X AQ SP X SQ $13.70 X 950 $14.00 X 950 $14.00 X 1,000 (.5x2,000) $13,015 |_________ $13,300 _____________| |______________ $14,000 __________| (-) Labor Rate Variance (-) Labor Efficiency Variance -$285 F -$700 F c. Variable Manufacturing Overhead variances: Actual Cost Mixed Flexible Budget AP X AQ SP X AQ SP X SQ $4.00 X 950 $4.00 X 1,000 (.5 x 2,000) $4,300 |_________ $3,800 _____________| |______________ $4,000 __________| (-) Variable Overhead Spending Variance (-) Variable Overhead Efficiency Variance $500 U -$200 F d. Fixed Manufacturing Overhead variances: Actual Cost Fixed Overhead Static Budget Standard AP X AQ SP X SQ $6.00 X 1,000 (.5 x 2,000) $6,820 |_________ $6,600 ______________| |____________ $6,000 __________| (-) Fixed Overhead Budget Variance (-) Fixed Overhead Volume Variance $220 U $600
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