# quiz 6 solution - Question 1 XYZ Company makes 30,000...

• Notes
• 10
• 100% (8) 8 out of 8 people found this document helpful

This preview shows page 1 - 4 out of 10 pages.

The preview shows page 2 - 4 out of 10 pages.
Question 1XYZ Company makes 30,000 motors to be used in the production of its power lawn mowers.The cost per motor at this level of activity is as follows:direct materials..............\$ 9.50direct labor..................8.60variable overhead.............3.75allocated fixed overhead......4.35total.........................\$26.20The motor has recently become available from an outside supplier for \$25 per motor. IfXYZ purchases the motor from the outside supplier, the space that is currently beingused to manufacture the motor can be rented out for \$154,500 per year.Calculate theselling price per unit charged by the outside supplier that would makeXYZ economically indifferent between making and buying the motor.BUYMAKExX
Question 2Accelerator, Inc. manufactures a fuel additive called surge. Surge sells for \$44 percontainer and the company produces and sells 80,000 containers per month. The companyhas established the following standards for each container of surge produced:standard quantitystandard pricedirect materials8 gallons\$2.00 per gallondirect labor1.25 hours\$8.00 per hourThe following information is available for surge for the month of September:1.645,000 gallons of chemicals were purchased at a cost of \$1,161,000. 600,000gallons were used in the production of surge during September.2.94,000 direct labor hours were worked during September at a cost of \$759,520.Calculate thedirect material price variancefor September.xSP)x2)
Question 3Accelerator, Inc. manufactures a fuel additive called surge. Surge sells for \$44 percontainer and the company produces and sells 80,000 containers per month. The companyhas established the following standards for each container of surge produced:standard quantitystandard pricedirect materials8 gallons\$2.00 per gallondirect labor1.25 hours\$8.00 per hourThe following information is available for surge for the month of September:1.645,000 gallons of chemicals were purchased at a cost of \$1,161,000. 600,000gallons were used in the production of surge during September.2.94,000 direct labor hours were worked during September at a cost of \$759,520.Calculate thedirect material quantity variancefor September.

Upload your study docs or become a

Course Hero member to access this document

Upload your study docs or become a

Course Hero member to access this document

End of preview. Want to read all 10 pages?

Upload your study docs or become a

Course Hero member to access this document

Term
Spring
Professor
TeriZiegler
Tags
Direct material price variance, XYZ Company