(Appendix 10B)Albert Manufacturing Company Manufactures a Single Product

question 105

Essay

(Appendix 10B)Albert Manufacturing Company manufactures a single product.The standard cost of one unit of this product is:

During the month of October, 6,000 units were produced. Selected cost data relating to the month's production follow:

There was no beginning inventory of raw materials. The variable overhead rate is based on direct labour-hours.

Required:

a) (Appendix 10B) For direct materials, compute the price and quantity variances for the month, and prepare journal entries to record activity for the month.
b) (Appendix 10B) For direct labour, compute the rate and efficiency variances for the month, and prepare a journal entry to record labour activity for the month.
c) For variable overhead, compute the spending variance for the month, and prove the efficiency variance given above.

---

Definitions:

Suggestibility

The degree to which a person is inclined to accept and incorporate ideas or beliefs suggested by others.

Fast-Acting

A term describing something that takes effect or produces results quickly.

A-Delta Fibres

Fast-conducting nerve fibers that transmit sharp, acute pain sensations to the brain.

Trichromatic Theory

A theory of color vision proposing that the human eye has three types of receptors with different sensitivities to light wavelengths, responsible for the perception of color.