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Chapter 21 - Quantity Variance • SP(AQ-SQ •...

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Chapter 21 - Variance 18:42 Actual                        Cost=(Price)(Quantity) Budgeted (Standard)   Cost=(Price)(Quantity)                                     $30,000     the absolute value Sales of 2000 units Purchased 5000 lbs. of material @ $1.75/lb. Standards for materials  2 lbs/unit $1.50/lb AQ: 5000 lbs SQ: 4000 lbs AP: $1.75/lb SP: $1.50/lb Price variance AQ(AP-SP) = 5000|$1.75-$1.50|= 5000(.25)=$1,250 U(nfavorable)
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Unformatted text preview: Quantity Variance • SP(AQ-SQ) • 1.50(5000-4000)=$1500 U Sales 2000 units In March: • worked 3,900 hours • paid $9750 Standard • Rate of $5/hour • Work 2 hours/unit AH: 3,900 SH: 4,000 AR: 2.50 SR: 5.00 Total Variance • 9750-20,000 = 10,250 F Quantity in Labor is Hours • SR(AH-SH) efficiency variance • 5(3900-4000)= 500 Favorable Price in Labor is Rate • AH(AR-SR) Rate Variance • 3900(2.50-5)=9,750 Favorable 21 18:42 18:42...
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