Question

8 Harrison Inc. has the following standards for the materiale d e production of the core product Standard quantity per unit of output $19 15 per pound The following data pertain to operations concerning the product for month Actual materials purchased 8.000 h Actual cost of materials purchased SI52.000 Actual materials used in production 7.100 lb 700 What is the purchase price variance of the materials for the month $1.065.00 Favorable $1,200.00 Unfavorable SI 200.00 Favorable $1.065.00 Unfavorable E None of the above Taft Corporation uses a standard costing system in which variable manufacturing overhead is assigned to production on the basis of machine hours. The following data pertain to one month's operations: Variable manufacturing overhead cost incurred: $65,000 Total flexible budget variable overhead cost: $74,550 Standard machine hours allowed for actual production: 3,550 MHS Actual machine hours incurred: 3,000 MHS 9 The variable overhead rate variance is: A $2,000 Favorable B. $2,000 Unfavorable $9,550 Favorable D. $9,550 Unfavorable E. None of the above

Answer 1

9) Material purchase price variance = (Standard price-actual price)actual quantity

= (19.15*8000-152000)

Material purchase price variance = 1200 F

So answer is c) $1200 Favorable

10) Variable overhead rate = 74550/3550 = 21

Variable overhead rate variance = (21*3000-65000) = 2000 U

So answer is b) $2000 Unfavorable