Standard Products Company Recognizes Variances from Standards at the Earliest

question 207

Essay

Standard Products Company recognizes variances from standards at the earliest opportunity, and the quantity of direct materials purchased is equal to the quantity used. The following information is available for the most recent month. Assume the allocation base for fixed overhead costs is the number of units.
Direct Materials Direct Labor
Standard quantity/unit 6.00 lbs. 2.5 hrs.
Standard price/lb. or hr. $8.10/lb. $8.00/hr.
Actual quantity/unit 6.25 lbs. 2.8 hrs.
Actual price/lb. or hr. $8.00/lb. $7.50/hr
Price variance $562.50 F $1,260.00 F
Quantity/Efficiency variance $1,822.50 U $2,160.00 U
Static budget volume 800 units
Actual volume 900 units
Actual overhead cost $11,000
Standard variable overhead cost $5/unit
Standard fixed overhead cost $5,600
Overhead flexible budget variance $900 U
Production volume variance $700 F
Journalize the purchase and usage of direct materials including the related variances.

---

Definitions:

Colorectal Cancer

A type of cancer that starts in the colon or rectum, characterized by the abnormal growth of cells in these locations.

Cancer Of The Blood Vessels

A rare form of cancer that affects the lining of the blood vessels, also known as angiosarcoma.

Invasive Cervical Cancer

A form of cervical cancer that has spread from the surface of the cervix to tissue deeper in the cervix or to other parts of the body.

Highly Contagious

Refers to diseases or conditions that can be easily and rapidly spread from one individual to another through direct contact or proximity.