The Tennison Company Uses a Standard Cost System in Which

question 10

Essay

The Tennison Company uses a standard cost system in which manufacturing overhead costs are applied to units of the company's single product on the basis of standard direct labor-hours (DLHs).The standard cost card for the product follows:

$$\begin{array} { | l | r | } \hline { \text { Standard Cost Cardper unit of product } } \\\hline \text { Direct Materials, 4 yards at } \$ 3.60 \text { pery ard } & \$ 14 \\\hline \text { Direct Labor, 1.5 DLHs at } \$ 8 \text { per DLH } & 12 \\\hline \text { Variable Ovemead, 1.5 DLHs at } \$ 2 \text { per DLH } & 3 \\\hline \text { Fixed Overhead, 1.5 DLHs at } \$ 6 \text { per DLH } &\underline{ 9 }\\\hline \text { Standard cost per unit } & \$ 38 \\\hline\end{array}$$ The following data pertain to last year's activities:Required:
a.Compute the direct materials price and quantity variances for the year.
b.Compute the direct labor rate and efficiency variances for the year.
c.Compute the variable overhead rate and efficiency variances for the year.
d.Compute the fixed manufacturing overhead budget and volume variances for the year.

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Definitions:

Inner Experience

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Outward Behavior

Observable actions or reactions of an individual, as opposed to internal thoughts or feelings.

Odd Cluster

A classification within personality disorders, often referring to a group characterized by eccentric behaviors; includes disorders such as paranoid, schizoid, and schizotypal personality disorders.

Personality Disorders

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