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dexar [7]
3 years ago
6

Exercise 21-15 Direct materials and direct labor variances LO P2 The following information describes production activities of Me

rcer Manufacturing for the year.
Actual direct materials used 16,000 lbs. at $4.05 per lb.
Actual direct labor used 5,545 hours for a total of $105,355
Actual units produced 30,000
Budgeted standards for each unit produced are 0.50 pounds of direct material at $4.00 per pound and 10 minutes of direct labor at $20 per hour.

Compute the direct materials price and quantity variances
Business
2 answers:
Verdich [7]3 years ago
8 0

Answer:

Direct materials price variance = $800 Unfavorable

Direct materials quantity variance = $4,000 Unfavorable

Explanation:

Direct materials price variance = Aq×Ap-Aq×Sp

                                                   = (16,000×$4.05) - (16,000×$4.00)

                                                   = $800 Unfavorable

Direct materials quantity variance = Aq×Sp - Sq×Sp

                                               = (16,000×$4.00) - (30,000×0.50 pounds×$4.00 )

                                               = $4,000 Unfavorable

Molodets [167]3 years ago
6 0

Answer:

Instructions are below.

Explanation:

Giving the following information:

Actual direct materials used 16,000 lbs. at $4.05 per lb.

Actual units produced 30,000

Budgeted standards for each unit produced are 0.50 pounds of direct material at $4.00 per pound.

To calculate the direct material price and quantity variance, we need to use the following formulas:

Direct material price variance= (standard price - actual price)*actual quantity

Direct material price variance= (4 - 4.05)*16,000

Direct material price variance= $800 unfavorable

Direct material quantity variance= (standard quantity - actual quantity)*standard price

Standard quantity= 30,000*0.5= 15,000

Direct material quantity variance= (15,000 - 16,000)*4

Direct material quantity variance= $4,000 unfavorable

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Currently, you make one of the components needed for final assembly of your product and you are considering buying the part from
VashaNatasha [74]

Answer:

1. Break even quantity is 18,125 units

2. Cost to make 28,000 units = $ 775,000

3. Total costs to buy 28,000 units = $ 696,000

4. Savings by using low cost option ( buy from outside) $ 79,000

Explanation:

Computation of Break even point

Variable cost to make equipment in house                $ 25 per unit

Cost to purchase the unit from outside                       <u>$ 17 per unit</u>

Differential Cost per unit                                               <u>$ 8 per unit</u>

Fixed costs to be paid to outside supplier                  $ 220,000

Fixed costs to  be incurred in house                            <u>$  75,000</u>          

Incremental fixed costs                                                 $ 145,000

Break even point - Differential in fixed costs / Differential cost per  unit

$ 145,000/ $ 8 =                                                            18,125 units      

Computation of costs to make 28,000 units

Variable costs per unit -  $ 25 per unit

Units to be produced   -  28,000 units

Total Variable costs  $ 25 * 28,000 units                   $ 700,000

Fixed costs                                                                     $ <u> 75,000</u>

Total costs to make 28,000 units                               $ 775,000      

                               

Computation of costs to buy 28,000 units

Variable costs per unit -  $ 17 per unit

Units to be produced   -  28,000 units

Total Variable costs  $ 17 * 28,000 units                    $  476,000

Fixed costs                                                                    $  <u>220,000</u>

Total costs to make 28,000 units                              $ 696,000  

Computation of savings

Buying 28,000 units                                                    $ 775,000

Making 28,000 units                                                   <u>$ 696,000</u>

Savings from buying from outside                              $ 79,000                                

6 0
3 years ago
The process of setting aside money and putting it to work by having it earn interest or dividends or gain value in the equities
Kisachek [45]

Answer:

Saving and investing.

Explanation:

Savings is basically putting aside current money for future use. Investing is committing money to make profit over period of time.

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3 years ago
Caracteristicas de un seguro público
mr Goodwill [35]
It’s Spanish lol lol lol
6 0
2 years ago
The following information applies to the questions displayed below] A local Chevrolet dealership carries the following types of
myrzilka [38]

Answer:

Chevrolet Dealership

A) The total cost of the entire inventory is:

= $575,000

B) Each inventory would be reported at the LCNRV:

Inventory Items  Quantity  Reporting Cost/Value

Vans                        4              NRV

Trucks                     7              NRV

2-door sedans        3              Cost

4-door sedans        5              Cost

Sports cars              1              Cost

SUVs                       6              NRV

C) Journal Entry:

Debit Cost of goods sold $27,000

Credit Inventory $27,000

To write-down costs to net realizable values.

D) TRUE.

Explanation:

a) Data and Calculations:

Inventory Items  Quantity    Cost per unit      NRV per Unit      LCNRV

Vans                        4           27000 $108,000      25000        $100,000

Trucks                     7            18000   126,000       17000           119,000

2-door sedans        3           13000     39,000      15000            39,000

4-door sedans        5           17000     85,000     20000            85,000

Sports cars              1          37000      37,000     40000            37,000

SUVs                       6         30000    180,000     28000           168,000

Total Cost                                      $575,000                         $548,000

3 0
3 years ago
Joanna, a member, is a sole proprietor that specializes in data processing system design and installation. To facilitate her wor
a_sh-v [17]

Answer: d) None of the above

Explanation:

The profit on the sale is not a referral fee as Joanna did not facilitate a transaction between her clients and the people she bought the products for.

It is not a commission either because it is not a percentage of the products price earned as an incentive or extra fee for selling the products.

Her selling these products is allowed.

The answer is therefore None of the Above.

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