(Appendix 10B)The Following Is the Standard Cost Card for X

question 168

Essay

(Appendix 10B)The following is the standard cost card for X Company's only product:
$\begin{array} { l r } \text { Direct materials, } 4 \text { metres at } \$ 4.00 & \$ 16.00 \\\text { Direct labour, } 5 \text { hours at } \$ 10.00 & \$ 15.00 \\\text { Variable overhead, 1.5 hours at } \$ 3.00 & \$ 4.50 \\\text { Fixed overhead, 1.5 hours at } \$ 7.00 & \$ 10.50 \\\text { Standard cost per unit } & \$ 46.00 \\\end{array}$

The company manufactured and sold 18,000 units of product during the year. A total of 70,200 metres of material was purchased during the year at cost of $4.20 per metre. All of this material was used to manufacture the 18,000 units. The company records showed no beginning or ending inventories for the year.

The company worked 29,250 direct labour hours during the year at a cost of $9.75 per hour. Overhead cost is applied to products on the basis of direct labour hours. The denominator activity level (direct labour hours) was 22,500 hours. Budgeted fixed overhead costs as shown on the flexible budget were $157,500, while actual fixed overhead costs were $156,000. Actual variable overhead costs were $90,000.

Required:

a) Compute the direct materials price and quantity variances for the year.
b) Compute the direct labour rate and efficiency variances for the year.
c) Compute the variable overhead spending and efficiency variances for the year.
d) Compute the fixed overhead budget and volume variances for the year.
e) (Appendix 10B) Prepare a journal entry to record the variable overhead costs incurred and applied, including the results of the variance analysis.
f) (Appendix 10B) Prepare a journal entry to record the fixed overhead costs incurred and applied, including the results of the variance analysis.

Identify the role of independent and dependent variables in an experimental design.

Understand the significance of control procedures such as random assignment and double-blind procedures in enhancing the validity of experimental findings.

Recognize the effects of experimenter expectancy and placebo effects on research outcomes.

Understand the concept of replication in research for validating findings.

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Definitions:

Creditors

Individuals or institutions to whom money is owed by debtors, or people who have borrowed money.

Shareholders

Individuals or entities who own one or more shares of stock in a corporation, making them partial owners of the company.

Dissolution

The process of legally dissolving or ending an entity, such as a corporation or partnership.

Debenture

A type of debt instrument that is not secured by physical assets or collateral but is backed by the general creditworthiness and reputation of the issuer.