standard costs and variances

The standard costs and variances for direct materials, direct labor, and factory overhead for the month of May are as follows:

Determine the actual costs incurred during the month of May for direct materials, direct labor, and manufacturing overhead. (Omit the “$” sign in your response.)

Actual costs incurred

$

The accountants for Polyglaze, Inc., have developed the following information regarding the standard cost and the actual cost of a product manufactured in June:

Actual Cost

Direct materials:

Standard: 10 ounces at $0.15 per ounce

1.50

Actual: 11 ounces at $0.16 per ounce

1.76

Direct labor:

Standard: 0.50 hours at $10.00 per hour

5.00

Actual: 0.45 hours at $10.40 per hour

4.68

Manufacturing overhead:

Standard: $5,000 fixed cost and $5,000 variable
cost for 10,000 units normal monthly volume

1.00

Actual: $5,000 fixed cost and $4,600 variable cost
for 8,000 units actually produced in June

1.20

Total unit cost

7.50

7.64

a-1

Compute the materials price variance and the materials quantity variance, indicating whether each is favorable or unfavorable. (Indicate the effect of each variance by selecting “F” for favourable, “U” for unfavourable, and “None” for no effect (i.e., zero variance). Negative amounts should be indicated by a minus sign. Omit the “$” sign in your response.)

Materials price variance

Materials quantity variance

a-2

Prepare the journal entry to record the cost of direct materials used during June in the Work in Process account (at standard). (Omit the “$” sign in your response.)

General Journal

Debit

Credit

b-1

Compute the labor rate variance and the labor efficiency variance, indicating whether each is favorable or unfavorable. (Indicate the effect of each variance by selecting “F” for favourable, “U” for unfavourable, and “None” for no effect (i.e., zero variance).Negative amounts should be indicated by a minus sign. Omit the “$” sign in your response.)

Labor rate variance

Labor efficiency variance

b-2

Prepare the journal entry to record the cost of direct labor used during June in the Work in Process account (at standard). (Omit the “$” sign in your response.)

c-1

Compute the overhead spending variance and the overhead volume variance, indicating whether each is favorable or unfavorable. (Indicate the effect of each variance by selecting “F” for favourable, “U” for unfavourable, and “None” for no effect (i.e., zero variance). Negative amounts should be indicated by a minus sign. Omit the “$” sign in your response.)

Overhead spending variance

Overhead volume variance

c-2

Prepare the journal entry to assign overhead cost to production in June. (Omit the “$” sign in your response.)