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    Mas Exercises

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    John Rey Bantay Rodriguez
    Raff Co. had an unfavorable variable overhead spending variance of P6,000 for March due to producing 38,000 units instead of the standard 50,000 units. Raff Co. also had a favorable fixed overhead volume variance of P24,000 for March due to producing fewer than the standard amount of units. Edney Company had an unfavorable variable overhead spending variance of P15,000 and a favorable fixed overhead variance of P12,000 for November due to producing more units than standard, but using fewer direct labor hours than planned. Garch Inc. had an unfavorable fixed overhead spending variance of P12,000, an unfavorable volume variance of P8,

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    Mas Exercises

    Uploaded by

    John Rey Bantay Rodriguez
    814 views2 pages
    Raff Co. had an unfavorable variable overhead spending variance of P6,000 for March due to producing 38,000 units instead of the standard 50,000 units. Raff Co. also had a favorable fixed overhead volume variance of P24,000 for March due to producing fewer than the standard amount of units. Edney Company had an unfavorable variable overhead spending variance of P15,000 and a favorable fixed overhead variance of P12,000 for November due to producing more units than standard, but using fewer direct labor hours than planned. Garch Inc. had an unfavorable fixed overhead spending variance of P12,000, an unfavorable volume variance of P8,

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    MAS EXERCISES

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    MAS EXERCISES

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    Raff Co. had an unfavorable variable overhead spending variance of P6,000 for March due to producing 38,000 units instead of the standard 50,000 units. Raff Co. also had a favorable fixed overhead volume variance of P24,000 for March due to producing fewer than the standard amount of units. Edney Company had an unfavorable variable overhead spending variance of P15,000 and a favorable fixed overhead variance of P12,000 for November due to producing more units than standard, but using fewer direct labor hours than planned. Garch Inc. had an unfavorable fixed overhead spending variance of P12,000, an unfavorable volume variance of P8,

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    814 views2 pages

    Mas Exercises

    Uploaded by

    John Rey Bantay Rodriguez
    Raff Co. had an unfavorable variable overhead spending variance of P6,000 for March due to producing 38,000 units instead of the standard 50,000 units. Raff Co. also had a favorable fixed overhead volume variance of P24,000 for March due to producing fewer than the standard amount of units. Edney Company had an unfavorable variable overhead spending variance of P15,000 and a favorable fixed overhead variance of P12,000 for November due to producing more units than standard, but using fewer direct labor hours than planned. Garch Inc. had an unfavorable fixed overhead spending variance of P12,000, an unfavorable volume variance of P8,

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    © All Rights Reserved
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    of 2

    Questions I to II are based on a monthly normal volume of 50,000 units (100,000 direct labor

    hours). Raff Co.’s standard cost system contains the following overhead costs:
    Variable P6 per unit
    Fixed P8 per unit

    The following information pertains to the month of March:


    Units actually produced 38,000
    Actual direct labor hours worked 80,000
    Actual overhead incurred:
    Variable P250,000
    Fixed 384,000

    I. For March, the unfavorable variable overhead spending variance was:


    II. For March, the fixed overhead volume variance was:

    Questions III to IV. Edney Company employs standard absorption system for product costing. The
    standard cost of its product is as follows:
    Raw materials P14.50
    Direct labor (2 DLH x P8) 16.00
    Manufacturing overhead (2 DLH x P11) 22.00
    The manufacturing overhead rate is based upon a normal activity level of 600,000 direct labor hours.
    Edney planned to produce 25,000 units each month during the year. The budgeted annual
    manufacturing overhead is
    Variable P3,600,000
    Fixed 3,000,000
    During November, Edney produced 26,000 units. Edney used 53,500 direct labor hours in November
    at a cost of P433,350. Actual manufacturing overhead for the month was P260,000 fixed and
    P315,000 variable. The total manufacturing overhead applied during November was P572,000.

    III. The variable manufacturing overhead variances for November are:


    IV. The fixed manufacturing overhead variances for November are:

    The following information will be used to answer Question Nos. V to VIII:


    Garch, Inc. analyzes manufacturing overhead in the production of its only one product, CD. The
    following set of information applies to the month of May, 2006:
    Budgeted Actual
    Units produced 40,000 38,000
    Variable manufacturing OH P 4/DLH P16,400
    Fixed manufacturing overhead P20/DLH P88,000
    Direct labor hours 6 min/unit 4,200 hr
    V. What is the fixed overhead spending variance?
    VI. What is the volume variance?
    VII. How much was the variable overhead spending variance?
    VIII. How much overhead efficiency variance resulted for the month of May?

    Questions IX to XII are based on Darf Company, which applies overhead on the basis of direct
    labor hours. Two direct labor hours are required for each product unit. Planned production for the
    period was set at 9,000 units. Manufacturing overhead is budgeted at P135,000 for the period, of
    which 20% of this cost is fixed. The 17,200 hours worked during the period resulted in production of
    8,500 units. Variable manufacturing overhead cost incurred was P108,500 and fixed manufacturing
    overhead cost was P28,000. Darf Company uses a four variance method for analyzing manufacturing
    overhead.

    IX. The variable overhead spending variance for the period is


    X. The variable overhead efficiency variance (quantity) variance for the period is
    XI. The fixed overhead budget (spending) variance for the period is
    XII. The fixed overhead volume (denominator) variance for the period is
    Ultra Shine Company manufactures a cleaning solvent. The company employs both skilled and
    unskilled workers. To produce one 55-gallon drum of solvent requires Materials A and B as well as
    skilled labor and unskilled labor. The standard and actual material and labor information is
    presented below:

    Standard:
    Material A: 30.25 gallons @ P1.25 per gallon
    Material B: 24.75 gallons @ P2.00 per gallon

    Skilled Labor: 4 hours @ P12 per hour


    Unskilled Labor: 2 hours @ P 7 per hour

    Actual:
    Material A: 10,716 gallons purchased and used @ P1.50 per gallon
    Material B: 17,484 gallons purchased and used @ P1.90 per gallon

    Skilled labor hours: 1,950 @ P11.90 per hour


    Unskilled labor hours: 1,300 @ P7.15 per hour
    During the current month Ultra Shine Company manufactured 500 55-gallon drums.

    Round all answers to the nearest whole peso.

    What is the total material price variance?


    What is the total material mix variance?
    What is the total material yield variance?
    What is the labor rate variance?
    What is the labor mix variance?
    What is the labor yield variance?

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