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# 5.          A company’s manufacturing plans were as follows: Units to be manufactured:       1,000 units Budgeted variable...

5.          A company’s manufacturing plans were as follows:

Units to be manufactured:       1,000 units

Budgeted variable costs:                      \$50,000 [50q (\$50 per unit)]

Budgeted fixed costs:              \$30,000

Budgeted mixed costs:             \$20,000 [14,000 + 6q (\$14,000 fixed + \$6 per unit)]

Later, the company actually produced 1,200 units, and incurred variable costs of \$52,000; fixed costs of \$31,000; and mixed costs of \$21,000.

1. The flexible budget for 1,200 units will show the total budgeted cost of \$_______.
2. The amount of the overall spending (total) variance (for all costs together) is \$_______
3. indicate whether it is favorable or unfavorable.

6.         Gyne Company makes Product X using special plastic as the main material. The company made 1,000 units of X using 4,500 lbs of plastic. The plastic actually cost the company \$22 per lbs (total \$99,000). According to the company’s standards, each unit of X should require 5 lbs of plastic, at a price of \$20 per lbs.

(a) What cost of plastic should have been incurred to make 1,000 units of X?

(b) How much is the spending (total) variance?

(c) Is the spending variance favorable or unfavorable?

(d) Compute the price variance

(e) Is the price variance favorable or unfavorable?

(f) Compute the quantity variance

(g) Is the quantity variance favorable or unfavorable?

7.          Cyric Company’s labor standard for one unit of a given product is 12 hours, and the standard rate for one hour of labor is \$70. The company actually made 300 units of the product, and used 3,300 hours of labor, and incurred \$260,000 labor cost.

1. Compute the rate variance
2. Is the rate variance favorable or unfavorable?
3. Compute the efficiency variance
4. Is the efficiency variance favorable or unfavorable?
5. Compute the spending (total) variance
6. Is the spending (total) variance favorable or unfavorable?

8.         The Wright Company has a standard costing system. The following data are available:

 Actual quantity of direct material.................................................................................... ......................................................................... Actual quantity of direct material purchased and used............................................................................ 25,000 pounds Standard price of direct material....................................................................... \$2 per pound Total material variance \$7,000, favorable Material quantity variance...................................................................... \$9,500, unfavorable

The actual price per pound of the direct material is: \$_____

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