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Cost Accounting Chapter 10 Exercise 1 6

1. The document provides examples of calculating standard costs and variances for materials, labor, and overhead. It includes calculations of standard purchase price per gram of a material, standard quantity per capsule, standard cost per capsule, material and efficiency variances, rate and efficiency variances for labor, and spending and efficiency variances for overhead. 2. The examples show comparing actual costs to standard costs to calculate variances. Variances are identified as favorable or unfavorable based on whether the standard or actual was higher. 3. Calculations are provided to derive standard hourly rates, actual rates, standard quantities, actual quantities, and efficiencies needed to calculate the various variances.

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1K views5 pages

Cost Accounting Chapter 10 Exercise 1 6

1. The document provides examples of calculating standard costs and variances for materials, labor, and overhead. It includes calculations of standard purchase price per gram of a material, standard quantity per capsule, standard cost per capsule, material and efficiency variances, rate and efficiency variances for labor, and spending and efficiency variances for overhead. 2. The examples show comparing actual costs to standard costs to calculate variances. Variances are identified as favorable or unfavorable based on whether the standard or actual was higher. 3. Calculations are provided to derive standard hourly rates, actual rates, standard quantities, actual quantities, and efficiencies needed to calculate the various variances.

Uploaded by

Baby Mushroom
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Exercise 1

1. Standard purchase price for one gram of Beta ML12


Cost per 2kg 6000
2% Discount 120
Net Cost 5880
Freight Cost(1000/10) 100
Total Cost 2000
(2kg x 1000 grams per kg)
Standard Purchase Price 2.99

2.Standard quantity of beta ML12 per capsule that passes final inspection
Required per capsule 6
Allowance for materials rejected
(6/96%-6.25 grams-6 grams) 0.25
Total 6.25
Allowance for rejected capsules(6.25/25) 0.25
Standard of Quantity 6.50

3.Standard cost card


Standard of Quantity per Capsule Standard Purchase Price Per Gram Standard Cost per Capsule

BETA ML12 6.50 2.99 19.435

Exercise 2
1. 4,000 X 2.5 = 10,000 Quantity
10,000 X 1.80 = 18,000 Standard Cost
Standard Cost Is Less Than By 700 Than The Actual Cost

2.Actual Quantity X Actual Price


11,000 X 1.70 = 18,700
Actual Quantity X Standard Price
11,000 X 1.80 = 19,800
Standard Quantity X Standard Price
10,000 X 1.80 = 18,000
Material Price Variance 1100 Favorable
Material Quantity Variance (1800 Unfavorable)
700 Unfavorable

Exercise 3
1. 48,000 = 20,000 X 2.40
Standard Cost Is Less than of 1,300 to the Actual Cost
2. Actual Hour X Actual Rate
8,500 X 5.8 = 49,300
Actual Hour X Standard Rate
8,500 X 6 = 51,000
Standard Hour X Standard Rate
8,000 X 6 = 48,000
Rate Variance 1,700 Favorable
Efficiency Variance (3,000 Unfavorable)
1,300 Unfavorable
3. Actual Hour X Actual Rate
8,500 X 4.60 = 39,100
Actual Hour X Standard Rate
8,500 X 4 = 34,000
Standard Hour X Standard Rate
8,000 X 4= 32,000
Spending Variance 5,100 Unfavorable
Efficiency Variance +2,000 Unfavorable
7,100 Unfavorable

Exercise 4
1.Efficiency Variance 480 = 6 (AH-420 Hours)
480 = 6 X AH- 2520
3000 = 6 X AH
500 = AH
2. Rate Variance 150 = 500(AR+6)
-150 = 500 X AR- 3000
2,850 = 500 X AR
5.70 PER HR. =AR

Exercise 5
1. 6,000 X.20 = 1,200
1,200 X 9.50 = 11,400
The Standard Cost is Less than by 100 to Actual Cost

2. Actual Hour X Actual Rate


11,500 = 1,150x 10
Actual Hour X Standard Rate
10,925 = 1,150 X 9,50
Standard Hour X Standard Rate
11,400 = 1,200 X 9.50
Rate Variance 575 Unfavorable
Efficiency Variance (475 Favorable)
100 Unfavorable

Exercise 6
1. 5,600 = 140,000 X 0.04
15,680 = 5,600 X 2.80
The Standard Cost is Less than by 270 to the Actual Cost

2. AH X AR
5800 X 2.75 = 15, 950
AH X SR
5,800 X 2.80 = 16,240
SH X SR
5,600 X 2.80 = 15,680
Spending Variance 290 Favorable
Efficiency Variance (560 Unfavorable)
270 Unfavorable

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