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ERCISE 9-11 Working Backwards from Labor Variances LO9-5 The auto repair shop of Quality Motor Company uses standards to control the labor ti the shop. The standard labor cost for a motor tune-up is given below: Flexible Budgets, Standard Costs, and Variance Analysis Standard Hours Standard Rate Standard Cost Motor tune-up 2.5 $25.00 $62.50 The record showing the time spent in the shop last week on motor tune-ups has been misplaced. However, the shop supervisor recalls that 50 tune-ups were completed during the week, and the controller recalls the following variance data relating to tune-ups: Labor rate variance Labor spending variance $150 F $200 U Required: 1. Determine the number of actual labor hours spent on tune-ups during the week. 2. Determine the actual hourly rate of pay for tune-ups last week. (Round your answer to the nearest cent.) (Hint: A useful way to proceed would be to work from known to unknown data by using the columnar format shown in Exhibit 9-12.) PROBLEM 9-26 Comprehensive Variance Analysis LO9-4. LO9-5, LO9-6 Highland Company produces a lightweight backpack that is popular with college students. Standard van able costs relating to a single backpack are given below: Standard Quantity or Hours Standard Cost Standard Price or Rate $6 per yard 7 $3 per direct labor hour $? 2 ? ? ? Direct materials Direct labor Variable manufacturing overhead Total standard cost per unit $7 Overhead is applied to production on the basis of direct labor-hours. During March, 1.000 backpacks excre manufactured and sold. Selected information relating to the month's production is given below: Materials Used Direct Labor $21.000 2 Variable Manufacturing Overhead $4,200 $3,600 $16.800 $15,000 ? $1,200 U Total standard cost allowed Actual costs incurred Materials price variance Materials quantity variance 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 March's production: 1.500 Actual direct labor hours Difference between standard and actual cost per backpack produced during March $0.15 F Required: (Hint: It may be helpful to complete a general model diagram for direct materials, direct labor, and variable manufacturing overhead before attempting to answer any of the requirements) What is the standard cost of a single backpack? 2. What was the actual cost per backpack produced during March? 3. How many yards of material are required at standard per backpack? 4. What was the materials price variance for Murch if there were no beginning or ending investories of materials? 5. What is the standard direct labor rate per hour? What was the labor rate variance for March? The labor efficiency variance 7 What was the variable overhead rate variance for March? The variable Overhead efficiency variance? & Prepare a standard cost card for one backpack 6 ERCISE 9-11 Working Backwards from Labor Variances LO9-5 The auto repair shop of Quality Motor Company uses standards to control the labor ti the shop. The standard labor cost for a motor tune-up is given below: Flexible Budgets, Standard Costs, and Variance Analysis Standard Hours Standard Rate Standard Cost Motor tune-up 2.5 $25.00 $62.50 The record showing the time spent in the shop last week on motor tune-ups has been misplaced. However, the shop supervisor recalls that 50 tune-ups were completed during the week, and the controller recalls the following variance data relating to tune-ups: Labor rate variance Labor spending variance $150 F $200 U Required: 1. Determine the number of actual labor hours spent on tune-ups during the week. 2. Determine the actual hourly rate of pay for tune-ups last week. (Round your answer to the nearest cent.) (Hint: A useful way to proceed would be to work from known to unknown data by using the columnar format shown in Exhibit 9-12.) PROBLEM 9-26 Comprehensive Variance Analysis LO9-4. LO9-5, LO9-6 Highland Company produces a lightweight backpack that is popular with college students. Standard van able costs relating to a single backpack are given below: Standard Quantity or Hours Standard Cost Standard Price or Rate $6 per yard 7 $3 per direct labor hour $? 2 ? ? ? Direct materials Direct labor Variable manufacturing overhead Total standard cost per unit $7 Overhead is applied to production on the basis of direct labor-hours. During March, 1.000 backpacks excre manufactured and sold. Selected information relating to the month's production is given below: Materials Used Direct Labor $21.000 2 Variable Manufacturing Overhead $4,200 $3,600 $16.800 $15,000 ? $1,200 U Total standard cost allowed Actual costs incurred Materials price variance Materials quantity variance 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 March's production: 1.500 Actual direct labor hours Difference between standard and actual cost per backpack produced during March $0.15 F Required: (Hint: It may be helpful to complete a general model diagram for direct materials, direct labor, and variable manufacturing overhead before attempting to answer any of the requirements) What is the standard cost of a single backpack? 2. What was the actual cost per backpack produced during March? 3. How many yards of material are required at standard per backpack? 4. What was the materials price variance for Murch if there were no beginning or ending investories of materials? 5. What is the standard direct labor rate per hour? What was the labor rate variance for March? The labor efficiency variance 7 What was the variable overhead rate variance for March? The variable Overhead efficiency variance? & Prepare a standard cost card for one backpack 6

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