Mackinaw Inc. processes a base chemical into plastic. Standardcosts and actual costs for direct...

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Accounting

Mackinaw Inc. processes a base chemical into plastic. Standardcosts and actual costs for direct materials, direct labor, andfactory overhead incurred for the manufacture of 78,000 units ofproduct were as follows:
Standard Costs Actual Costs
Direct materials 202,800 lbs. at $5.50 200,800 lbs. at $5.30
Direct labor 19,500 hrs. at $16.10 19,950 hrs. at $16.40
Factory overhead Rates per direct labor hr.,
based on 100% of normal
capacity of 20,350 direct
labor hrs.:
Variable cost, $2.90 $55,980 variable cost
Fixed cost, $4.60 $93,610 fixed cost
Each unit requires 0.25 hour of direct labor.
Required:
a. Determine the direct materials pricevariance, direct materials quantity variance, and total directmaterials cost variance. Enter a favorable variance as a negativenumber using a minus sign and an unfavorable variance as a positivenumber.
Direct Material Price Variance $
Direct Materials Quantity Variance $
Total Direct Materials Cost Variance $
b. Determine the direct labor rate variance,direct labor time variance, and total direct labor cost variance.Enter a favorable variance as a negative number using a minus signand an unfavorable variance as a positive number.
Direct Labor Rate Variance $
Direct Labor Time Variance $
Total Direct Labor Cost Variance $
c. Determine variable factory overheadcontrollable variance, the fixed factory overhead volume variance,and total factory overhead cost variance. Enter a favorablevariance as a negative number using a minus sign and an unfavorablevariance as a positive number.
Variable factory overhead controllable variance $
Fixed factory overhead volume variance $
Total factory overhead cost variance $

Answer & Explanation Solved by verified expert

3.9 Ratings (559 Votes)

Answer A Material Variance Direct Material Price Variance Actual Price Standard Price Actual Quantity 53 550 200800 40160 Favorable Variance As actual price is less than standard price 2 Direct Material Quantity Variance Actual Quantity Standard Quantity Standard Price 200800 202800 550 11000 Favorable Variance As actual quantity used is less than standard quantity 3 Total Direct Material Cost Variance Actual Cost Actual See Answer

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In: AccountingMackinaw Inc. processes a base chemical into plastic. Standardcosts and actual costs for direct materials,...Mackinaw Inc. processes a base chemical into plastic. Standardcosts and actual costs for direct materials, direct labor, andfactory overhead incurred for the manufacture of 78,000 units ofproduct were as follows:Standard CostsActual CostsDirect materials202,800 lbs. at $5.50200,800 lbs. at $5.30Direct labor19,500 hrs. at $16.1019,950 hrs. at $16.40Factory overheadRates per direct labor hr.,based on 100% of normalcapacity of 20,350 directlabor hrs.:Variable cost, $2.90$55,980 variable costFixed cost, $4.60$93,610 fixed costEach unit requires 0.25 hour of direct labor.Required:a. Determine the direct materials pricevariance, direct materials quantity variance, and total directmaterials cost variance. Enter a favorable variance as a negativenumber using a minus sign and an unfavorable variance as a positivenumber.Direct Material Price Variance$Direct Materials Quantity Variance$Total Direct Materials Cost Variance$b. Determine the direct labor rate variance,direct labor time variance, and total direct labor cost variance.Enter a favorable variance as a negative number using a minus signand an unfavorable variance as a positive number.Direct Labor Rate Variance$Direct Labor Time Variance$Total Direct Labor Cost Variance$c. Determine variable factory overheadcontrollable variance, the fixed factory overhead volume variance,and total factory overhead cost variance. Enter a favorablevariance as a negative number using a minus sign and an unfavorablevariance as a positive number.Variable factory overhead controllable variance$Fixed factory overhead volume variance$Total factory overhead cost variance$

	Standard Costs		Actual Costs
Direct materials	202,800 lbs. at $5.50		200,800 lbs. at $5.30
Direct labor	19,500 hrs. at $16.10		19,950 hrs. at $16.40
Factory overhead	Rates per direct labor hr.,
	based on 100% of normal
	capacity of 20,350 direct
	labor hrs.:
		Variable cost, $2.90	$55,980 variable cost
		Fixed cost, $4.60	$93,610 fixed cost

Direct Material Price Variance	$
Direct Materials Quantity Variance	$
Total Direct Materials Cost Variance	$

Direct Labor Rate Variance	$
Direct Labor Time Variance	$
Total Direct Labor Cost Variance	$

Variable factory overhead controllable variance	$
Fixed factory overhead volume variance	$
Total factory overhead cost variance	$