A labor efficiency variance resulting from the use of poor quality materials should be charged to:

a.
the production manager.

b.
the purchasing agent.

c.
manufacturing overhead.

d.
the industrial engineering department.

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Jarrod RobelLv2

6 Apr 2018

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Problem 25-1A Partially correct answer. Your answer is partially correct. Try again. Costello Corporation manufactures a single product. The standard cost per unit of product is shown below. Direct materialsâ3 pound plastic at $6.83 per pound $ 20.49 Direct laborâ1.50 hours at $12.00 per hour 18.00 Variable manufacturing overhead 9.00 Fixed manufacturing overhead 9.00 Total standard cost per unit $56.49 The predetermined manufacturing overhead rate is $12 per direct labor hour ($18.00 Ã· 1.50). It was computed from a master manufacturing overhead budget based on normal production of 8,250 direct labor hours (5,500 units) for the month. The master budget showed total variable costs of $49,500 ($6.00 per hour) and total fixed overhead costs of $49,500 ($6.00 per hour). Actual costs for October in producing 3,400 units were as follows. Direct materials (10,310 pounds) $ 71,551 Direct labor (4,950 hours) 60,489 Variable overhead 43,144 Fixed overhead 19,916 Total manufacturing costs $195,100 The purchasing department buys the quantities of raw materials that are expected to be used in production each month. Raw materials inventories, therefore, can be ignored. (a) Compute all of the materials and labor variances. (Round answers to 0 decimal places, e.g. 125.)

Total materials variance

Materials price variance

Materials quantity variance

Total labor variance

Labor price variance

Labor quantity variance

(b) Compute the total overhead variance.

Total overhead variance

coralwolf381

costello corporation manufactures asingle product. The standard cost per unit of product is shownbelow:

Direct materials - 2 pound plastic at $7.71 perpound - $15.42

Direct labor - 2.00 hours at $11.00 per hour - $22.00

Variable Manufacturing overhead - $12.00

Fixed Manufacturing overhead - $16.00

Total standard cost per unit - $65.42

The predetermined manufacturing overhead rate of $14 per directlabor hour ($28.00 / 2.00). It was computed from a mastermanufacturing overhead budget based on normal production of 10,200direct labor hours (5,100 units for the month). The master budgetshowed total variable costs of $61,200 ($6.00 per hour) and totalfixed overhead costs of $81,600 ($8.00 per hour). Actual costs forOctober in producing 4,200 units were as follows:

Direct materials (8,570 pounds) - $67,189

Direct labor (8,270 hours) - $93,368

Variable overhead - $89,609

Fixed overhead - $30,021

Total manufacturing costs - $280,187

The purchasing department buys the quantities of raw materialsthat are expected to be used in production each month. Rawmaterials inventories, therefore, can be ignored.

A. Compute all of the materials and labor variances andfavorable/unfavorable/neither

Total materials variances

Materials price variances

Materials quantity variances

Total labor variance

Labor price variance

Labor quantity variance

B. Compute the total overhead variance.