MA59 Problem: Variance Analysis - F & G Inc.

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MA59 Problem: Variance Analysis - F & G Inc.

 

The controller for F & G Inc. developed the following standards per unit:Input Required Standard Price or RateDirect materials 2 kgs$2.90 per kgDirect labour 3.5 hours$12.50 per hour Manufacturing Overhead:Variable --$2.20 per DLHFixed --$4.10 per DLH Normal volume for the month of August, based on historical results, was estimated to be 8,000units. Actual production results for August was 8,800 units, using the following inputs:Direct materials purchased 18,000 kgs @ $2.60/kgDirect materials issued to production 19,800 kgsDirect labour 32,200 hours @ a total cost of $425,040Actual manufacturing overheadVariable $68,360Fixed $112,100 Required:1. Calculate the following variances:a) direct material price and quantity variance b) direct labour rate and efficiency variancec) variable overhead spending and efficiency varianced) under or overapplied fixed overhead, fixed flexible budget variance, and productionvolume varianc

    • 9 years ago
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