Rip Tide Company manufactures surfboards. Its standard cost information follows: Direct materials (fiberglass) Direct labor Standard Quantity 15 square feet 10 hours 10 hours Variable manufacturing overhead (based on direct labor hours) Fixed manufacturing overhead ($24,000 + 300 units) Rip Tide has the following actual results for the month of June: Number of units produced and sold Number of square feet of fiberglass purchased and used Cost of fiberglass used Number of labor hours worked. Direct labor cost Variable overhead cost Fixed overhead cost 331 5,110 $ 29,127 3,250 $ 50,375 $ 13,890 $ 25,550 Standard Price (Rate) $5 per square feet $ 15 per hour $6 per hour Required: 1. Calculate the direct materials price, quantity, and total spending variances for Rip Tide. 2. Calculate the direct labor rate, efficiency, and total spending variances for Rip Tide. Standard Unit Cost $ 75.00 150.00 60.00 80.00
Rip Tide Company manufactures surfboards. Its standard cost information follows: Direct materials (fiberglass) Direct labor Standard Quantity 15 square feet 10 hours 10 hours Variable manufacturing overhead (based on direct labor hours) Fixed manufacturing overhead ($24,000 + 300 units) Rip Tide has the following actual results for the month of June: Number of units produced and sold Number of square feet of fiberglass purchased and used Cost of fiberglass used Number of labor hours worked. Direct labor cost Variable overhead cost Fixed overhead cost 331 5,110 $ 29,127 3,250 $ 50,375 $ 13,890 $ 25,550 Standard Price (Rate) $5 per square feet $ 15 per hour $6 per hour Required: 1. Calculate the direct materials price, quantity, and total spending variances for Rip Tide. 2. Calculate the direct labor rate, efficiency, and total spending variances for Rip Tide. Standard Unit Cost $ 75.00 150.00 60.00 80.00
Chapter5: Process Costing
Section: Chapter Questions
Problem 2PB: The following product costs are available for Kellee Company on the production of eyeglass frames:...
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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