Question 2 (This question has 3 items, (a), (b), and (c))Morry Games developed a new play station called AWESOME. Morry Games has a standard cost system to help control itscosts. The following standards have been established for AWESOME.• Direct materials 15 grams per AWESOME.• Standard direct material cost per AWESOME is $10.• Direct labour 1.2 hours per AWESOME.• Standard cost of direct labour is $14.40 per AWESOME.• During May the company produced 9,000 AWESOME units.Production data for May are:• Direct materials: 165,000 grams were purchased at a cost of S104,000; 20,000 grams of this was still in inventory at the endof the month.• Direct labour: 11,400 direct labour hours were worked at a cost of $142,600.Required:(a) Calculate Direct materials price and quantity variances.(b) Calculate Direct labour price and quantity variances.(c) Are the variances computed in (a) and (b) linked? Provide a brief commentary on the variances computed above, includingexplanations regarding the price and the quantity variances for Direct materials, and the price and the quantity variances forDirect labours.

The actual price for materials is lower than the standard price. Material usage variance is…

Answered: has 3 items, (a), (b), and (c))

Business

Accounting

has 3 items, (a), (b), and (c))

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Cryolab Inc makes and sells a lawn fertilizer called Hypergro. The company has developed standard costs for one bag of Hypergro as follows: Standard Quantity/Hours Standard Price/Rate Standard Cost per Bag Direct Material 25 pounds ₱ 0.75 ₱18.75 Direct Labor 0.25 hours ₱69.00 ₱17.30 Variable overhead 0.25 hours ₱24.00 ₱ 6.00 Total          ₱42.05 The company had no beginning inventories of any kind on January 1. Variable overhead is applied to production on the basis of standard direct labor hours. During January, the following activity was recorded by the company: Production of Fastgro: 23,000 bags Direct materials purchased: 585,000 pounds at a cost of ₱436,250 Direct labor worked: 5,800 hours at a cost of ₱397,300 Variable overhead incurred: ₱140,650 Inventory of direct materials on January 31: 8,000 pounds Compute the variances and indicate whether it is FAVORABLE (F) or UNFAVORABLE (U) in your solution sheet. The variable…
Cryolab Inc makes and sells a lawn fertilizer called Hypergro. The company has developed standard costs for one bag of Hypergro as follows: Standard Quantity/Hours Standard Price/Rate Standard Cost per Bag Direct Material 25 pounds ₱ 0.75 ₱18.75 Direct Labor 0.25 hours ₱69.00 ₱17.30 Variable overhead 0.25 hours ₱24.00 ₱ 6.00 Total          ₱42.05 The company had no beginning inventories of any kind on January 1. Variable overhead is applied to production on the basis of standard direct labor hours. During January, the following activity was recorded by the company: Production of Fastgro: 23,000 bags Direct materials purchased: 585,000 pounds at a cost of ₱436,250 Direct labor worked: 5,800 hours at a cost of ₱397,300 Variable overhead incurred: ₱140,650 Inventory of direct materials on January 31: 8,000 pounds The variable manufacturing overhead flexible budget/spending variance amounts to ₱_____________. The labor rate…
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! Required information [The following information applies to the questions displayed below.] BatCo makes baseball bats. Each bat requires 2.00 pounds of wood at $22 per pound and 0.40 direct labor hour at $20 per hour. Overhead is assigned at the rate of $40 per direct labor hour. Prepare a standard cost card for a baseball bat for BatCo. (Round your final answers to 2 decimal places.) X Answer is complete but not entirely correct. Standard Standard quantity or hours Standard cost per unit Inputs price or rate Direct materials 2.00 pounds 2$ 20.00 $ 40.00 X Direct labor 0.35 O DLH 20.00 7.00 x X Overhead 0.35 X DLH 40.00 14.00 x Total 61.00
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