Vitalite, Inc., produces a number of products, including a body-wrap kit. Standard variable costs relating to a single kit are given below:
Standard Quantity
or Hours Standard Price
or Rate Standard
Cost
Direct materials ? $6 per yard $ ?
Direct labor ? ? ?
Variable manufacturing overhead ? $2 per direct
labor-hour ?
Total standard cost per kit $42
During August, 500 kits were manufactured and sold. Selected information relating to the month s production is given below:
Materials Used Direct Labor Variable
Manufacturing
Overhead
Total standard cost* ? $8,000 $1,600
Actual costs incurred $10,000 ? $1,620
Materials price variance
Materials quantity variance $ 600 U
Labor rate variance
Labor efficiency variance
Variable overhead rate variance ?
Variable overhead efficiency variance ?
*For the month’s production.
The following additional information is available for August s production of kits:
Actual direct labor-hours 900
Difference between standard and actual cost per kit produced during August $.14 U
Required:
1.
What was the total standard cost of the materials used during August? (Omit the “$” sign in your response.)
Standard cost $
2.
How many yards of material are required at standard per kit? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)
Number of yards yards per kit
3.
What was the materials price variance for August if there were no beginning or ending inventories of materials? (Input all amounts as positive values. Do not round intermediate calculations. Leave no cells blank – be certain to enter “0” wherever required. Indicate the effect of each variance by selecting “F” for favorable, “U” for unfavorable, and “None” for no effect (i.e., zero variance). Omit the “$” sign in your response.)
Material price variance $
4.
What is the standard direct labor rate per hour? (Omit the “$” sign in your response.)
Standard direct labor rate $ per DLH
5.
What was the labor rate variance for August? The labor efficiency variance? (Input all amounts as positive values. Do not round intermediate calculations. Leave no cells blank – be certain to enter “0” wherever required. Indicate the effect of each variance by selecting “F” for favorable, “U” for unfavorable, and “None” for no effect (i.e., zero variance). Omit the “$” sign in your response.)
Labor rate variance $
Labor efficiency variance $
6.
What was the variable overhead rate variance for August? The variable overhead efficiency variance? (Input all amounts as positive values. Do not round intermediate calculations. Leave no cells blank – be certain to enter “0” wherever required. Indicate the effect of each variance by selecting “F” for favorable, “U” for unfavorable, and “None” for no effect (i.e., zero variance). Omit the “$” sign in your response.)
Variable overhead rate variance $
Variable overhead efficiency variance $
7.
Complete the standard cost card for one kit shown at the beginning of the problem. (Do not round intermediate calculations. Round your answers to 2 decimal places. Omit the “$” sign in your response.)
Standard Quantity
or Hours Standard Price or Rate Standard Cost
Direct materials yards $6 per yard $
Direct labor hours $ per hour
Variable manufacturing overhead hours $2 per direct labor-hour
Total standard cost per kit $42