Week 4 - Team Assignment

# Week 4 - Team Assignment - Week 4 Team A Question 8-44 The...

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1 of 13 Week 4 - Team A Question 8-44 1. Finished units produced: 4,000 boxes of chocolates. 3. Direct labor: Actual costs, 6,400 hours @ 30.5 SFR, or 195,200 SFR. Standard allowed per box produced, 1-1/2 hours. Standard price per d 4. Variable manufacturing overhead: Actual costs, 69,500 SFR. Budget formula is 10 SFR per standard direct-labor hour. Compute the following: 1. a. Materials purchase-price variance b. Materials quantity variance c. Direct-labor price variance d. Direct-labor quantity variance e. Variable manufacturing-overhead spending variance f. Variable manufacturing-overhead efficiency variance (Hint: For format, see the solution to the Summary Problem for Your Review, page 363.) 2. a. What is the budget allowance for direct labor? b. Would it be any different if production were 5,000 boxes? A B Actual Cost Flexible Budget Incurred: Based on Actual Actual Inputs X Inputs x Standard Actual Prices Prices Flexible budget variance (A - C) Direct materials 4,300 lbs x \$15.00 4,300 lbs x \$16.00 66,650 68,800 Price variance Quantity variance (A - B) (2,150) (B- C) = Favorable The Zurich Chocolate Company uses standard costs and a flexible budget to control its manufacture of fine chocolates. The purchasing agen price variances, and the production manager is responsible for all other variances. Operating data for the past week are summarized as follow 2. Direct materials: Purchased and used, 4,300 pounds of chocolate @ 15.5 Swiss francs (SFR) per pound; standard price is 16 SFR per pou box produced, 1 pound.

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2 of 13 Flexible budget variance (A - C) Direct labor 6,400 lbs x \$30.50 6,400 lbs x \$30.00 195,200 192,000 Price variance Quantity variance (A - B) = 3,200 (B- C) = Unfavorable Flexible budget variance (A - C) Variable manufacturing overhead variance A B 69,500 64,000 manufacturing overhead manufacturing overhead spending variance
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## This note was uploaded on 07/18/2011 for the course ACC 561 taught by Professor Cole during the Spring '09 term at University of Phoenix.

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Week 4 - Team Assignment - Week 4 Team A Question 8-44 The...

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