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Ch 9 Problem - 9 43,000 hours of direct labor were used in...

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2 HOMEWORK S9.2 Cougar Company produces components for airplane motors and uses a standard cost system for product costing and control purposes. The standard cost sheet for manufacturing a widely used line of valves shows a standard cost of $17.00 per valve with the following standard cost card. Direct materials (1.5 lbs @ $4.00) $6.00 Direct Labor (0.2 hours @ $20 per hour) 4.00 Variable Overhead (0.2 hours @ $5 per hour) 1.00 Fixed Overhead (0.2 hours @ $30 per hour) 6.00 Total standard unit cost $17.00 During the year Ace produced 180,000 valves and its accounting records show the following results: 6. Purchased 280,000 pounds of direct materials at an average cost of $4.10 per pound. 7. There were 10,000 pounds of direct materials in beginning inventory carried on the books at the standard cost of $4.00per pound. 8. 265,000 pounds of direct materials were used in production.
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Unformatted text preview: 9. 43,000 hours of direct labor were used in production at a cost of $847,500 10. Actual manufacturing overhead costs for the year were $1,396,627. These costs were analyzed into $1,195,402 of fixed overhead and $201,225 of variable overhead. Normal activity for this production line is 200,000 valves per year. Standard overhead rates are computed based on normal activity based on standard direct labor hours. REQUIRED: a. Calculate price and usage variances for direct materials b. Calculate rate and efficiency variances for direct labor c. Compute overhead variances using a four way analysis of variances d. Prepare all summary journal entries for this case assuming a 4 way analysis of overhead variances is used. e. Compute overhead variances using a 2 way analysis of variances f. Compute overhead variances using a 3 way analysis of variance...
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