accounting unit 8

Use either a Word document or an Excel spreadsheet to complete the following in your Financial and Managerial Accounting textbook:

· Problem 21-4B, page 981.

There is no template for this assignment.

Problem 21-4B Computation of materials, labor, and overhead variances P2 P3

Kryll Company set the following standard unit costs for its single product.

The predetermined overhead rate is based on a planned operating volume of 80% of the productive capacity of 60,000 units per quarter. The following flexible budget information is available.

During the current quarter, the company operated at 70% of capacity and produced 42,000 units of product; direct labor hours worked were 250,000. Units produced were assigned the following standard costs:

Actual costs incurred during the current quarter follow.

Required

1. Compute the direct materials cost variance, including its price and quantity variances. Check  (1) Materials variances: Price, $250,000 U; Quantity, $200,000 F;

2. Compute the direct labor cost variance, including its rate and efficiency variances. (2) Labor variances: Rate, $62,500 F; Efficiency, $16,000 F

3. Compute the total overhead controllable and volume variances.