BRIEF EXERCISE 11

# BRIEF EXERCISE 11 - BRIEF EXERCISE 11-1(a Standards are...

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(a) Standards are stated as a per unit amount. Thus, the standards are materials \$2.00 (\$1,000,000 ÷ 500,000) and labor \$3.20 (\$1,600,000 ÷ 500,000). (b) Budgets are stated as a total amount. Thus, the budgeted costs for the year are materials \$1,000,000 and labor \$1,600,000. BRIEF EXERCISE 11-2 (a) Standard materials price per gallon = \$3.50 (\$3.20 + \$.20 + \$.10). (b) Standard materials quantity per gallon = 3 pounds (2.6 + .4). (c) Standard materials cost per gallon = \$10.50 (\$3.50 X 3). BRIEF EXERCISE 11-3 (a) Standard direct labor rate per hour = \$12.00 (\$10.00 + \$.80 + \$1.20). (b) Standard direct labor hours per gallon = 1.6 hours (1.2 + .25 + .15). (c) Standard labor cost per gallon = \$19.20 (\$12.00 X 1.6). BRIEF EXERCISE 11-4 Total materials variance = \$1,731 U (3,300 X \$5.07*) – (3,000 X \$5.00). Materials price variance = \$231 U (3,300 X \$5.07) – (3,300 X \$5.00). Materials quantity variance = \$1,500 U (3,300 X \$5.00) – (3,000 X

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BRIEF EXERCISE 11 - BRIEF EXERCISE 11-1(a Standards are...

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