Medium

1. Trisebentin Corp. produced 1,000 product X using Standard Costing System. The
following are related to the production of product X:
Standard (In every unit of product X)
Direct Labor Hours 3.17 hours
Total OH per DLH 45.00
Fixed OH per DLH 25.00
Total budgeted OH 170,000
Budgeted Fixed OH 70,000
The actual Direct Labor incurred is 1,600 hours. Also, the actual OH is 145,000 (85%
of Fixed OH is Variable OH)
What is the total overhead variance? Indicate if it is Favorable or unfavorable.
Solution:
45 x (3.17 x 1000) 145,000 = 2350 Unfavorable

2. Tri-Wan-Seben Co. manufactures Stick-Woah. The following are related to the

production of
Stick-Woah:
Raw and in Process, Jan. 1
100,000
Purchases
500,000
Conversion Cost
350,000
Raw and in Process, Dec. 31
???????
Goods Manufactured
840,000
Finished Goods, Jan. 1
400,000
Finished Goods Dec. 31
???????
Cost of Sales
1,000,000
Both RIP (beg. and end.) contains 95% materials. While finished goods in Jan. 1 and
Dec. 1 contain 92% and 90% materials respectively.
What is amount of Materials backflushed from Finished Goods to Cost of Sales?

Solution in #2
Total

Materials

Conversion Costs

Raw and in Process, Jan. 1

100,000
95,000
5,000
Purchases
500,000
500,000
Conversion Cost
350,000
Raw and in Process, Dec. 31
110,000
104,500
Goods Manufactured
840,000
490,500
Finished Goods, Jan. 1
400,000
368,000
Finished Goods Dec. 31
240,000
216,000
Cost of Sales
1,000,000
642,500

350,000
5,500
349,500
32,000
24,000
357,500

3. McJolly Corporation produces products using Standard Costing System. The

following information is related to the production of Hapi-Meal (chik-enjoy and
kwarter-pawnder berger):
Standard:
chik-enjoy: 1.25 @ 35.00 per unit
purchased and used

Actual:
chik-enjoy: 1,200 units
@ 38.00 per unit

kwarter-pawnder berger: 1.00 @ 30.00 per unit

1,050 units purchased
per unit

kwarter-pawnder berger:
and used @ 28.00

During the normal operating week, McJolly produced 1,000 Hapi-Meals.

What is the Total Material Variance?
Solution:
Material Purchase Variance:
1,200 x (35.00 38.00) = 3,600 UF
1,750 F
1,050 x (30.00 28.00) = 2,100 F
1,500 UF
1,500 UF

Material Usage Variance:

35.00 x [1.25 x 1,000 (1,200)] =
30.00 x [1.00 x 1,000 (1,050)] =

Total Material Variance: 1,500 UF + 250 F = 1,250 Unfavorable

250 F