Standard Product Cost, Direct Materials Variance

Condiments Company uses standards to control its materials costs. Assume that a batch of ketchup (1,500 pounds) has the following standards:

  Standard Quantity Standard Price Whole tomatoes 2,500 lbs. $ 0.44 per lb. Vinegar 140 gal. $ 2.70 per gal. Corn syrup 12 gal. $ 9.80 per gal. Salt 56 lbs. $ 2.40 per lb.

The actual materials in a batch may vary from the standard due to tomato characteristics. Assume that the actual quantities of materials for batch K-111 were as follows:

2,600 lbs. of tomatoes 134 gal. of vinegar 13 gal. of corn syrup 55 lbs. of salt

Determine the direct materials quantity variance for batch K-111. If required, round amounts to the nearest cent. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

Whole tomatoes $

Vinegar $

Corn syrup $

Salt $

Total direct materials quantity variance $

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I need to b. Determine the per-unit factory overhead allocated to the gasoline and diesel engines under the multiple production department factory overhead rate method, using direct labor hours as the activity base for each department. If required, round all per-unit answers to the nearest cent.he management of Firebolt Industries Inc. manufactures gasoline and diesel engines through two production departments, Fabrication and Assembly. Management needs accurate product cost information in order to guide product strategy. Presently, the company uses a single plantwide factory overhead rate for allocating factory overhead to the two products. However, management is considering the multiple production department factory overhead rate method. The following factory overhead was budgeted for Firebolt:

1

Fabrication Department factory overhead

$561,600.00

2

Assembly Department factory overhead

241,500.00

3

Total

$803,100.00

Direct labor hours were estimated as follows:

Fabrication Department4,800hoursAssembly Department5,250

Total10,050hours

In addition, the direct labor hours (dlh) used to produce a unit of each product in each department were determined from engineering records, as follows:

Production DepartmentsGasoline EngineDiesel EngineFabrication Department3.1 dlh1.8 dlhAssembly Department1.83.1Direct labor hours per unit4.9 dlh4.9 dlh

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