The roofing company manufactures shingles. Standard Cost Sheet per…
Question The roofing company manufactures shingles. Standard Cost Sheet per… The roofing company manufactures shingles. Standard Cost Sheet per shingle Direct materialsAsphalt1.4pounds$0.08 per pound Direct labor 0.01direct labor hour$14.50 per hour Variable Manufacturing overhead 0.01direct labor hour$2 per hour Fixed Manufacturing overhead 0.01direct labor hour$10 per hour Total standard cost per shingle Budgeted fixed manufacturing overhead for the period is $60,350 Budgeted units to be produced 600,000Units Standard fixed manufacturing overhead based on expected capacity of 6000direct labor hours The following information is available regarding the company’s actual operations for the period. Shingles produced 550,000 Materials purchased: Asphalt 752,000pounds$0.09 per pound Materials used: Asphalt 751,000pounds Direct labor: 5,360hours$15.00 per hour Manufacturing overhead incurred: Variable $11,899 $2.22 VOH rate per direct labor hour Fixed $60,100 Required: Make sure you do not forget to label each variance U or F. You need to use cell references for your calculations. 1. Calculate the direct materials price and quantity variance. Material price variance should be based on material purchased, since you want to isolate the variance as soon as possible. Material Quantity variance should be based on materials used, since this is monitoring the production efficiency. Material purchase price variance Material Quantity variance 2. Calculate the direct labor rate and efficiency variances. Labor rate variance Labor Efficiency variance 3. Variable manufacturing overhead spending and efficiency variances. Variable overhead spending variance Variable overhead efficiency variance 4. Fixed manufacturing overhead budget variance. Fixed Manufacturing overhead budget variance 5. Pick out the two variances that you computed above that you think should be further investigated. Explain why you picked these 2 variances and what might be the possible cause of the variances. Accounting Business Managerial Accounting MBA 641 Share QuestionEmailCopy link Comments (0)
