Comprehensive Problem

Standard Costing
1 Planning Budget Amount x No. of lb per unit x Cost per lb 30,000
x No. of pounds per unit 5
Total 150,000
x Standard Price 8.00
Raw Material Cost, March 1,200,000

2 Actual Quantity of Input (AQ) 160,000

Less: Standard Quantity of Input (SQ) 150,000
Total 10,000
x Standard Price (SP) 8.00
Materials Quantity Variance (MQV) 80,000

3 Standard Price 8.00

Less: Actual Price of Input (AP) 7.50
Total 1
x Actual Quantity of Input (AQ) 160,000
Materials Quantity Variance (MQV) 80,000

4 Actual Quantity of Input (AQ) 160,000

Less: Standard Quantity of Input (SQ) 150,000
Total 10,000
x Standard Price (SP) 8.00
Materials Quantity Variance (MQV) 80,000

Standard Price 8.00

Less: Actual Price of Input (AP) 7.50
Total 1
x Actual Quantity of Input (AQ) 170,000
Materials Quantity Variance (MQV) 85,000

5 Standard Hours 60,000

x Standard Rtae 14.00
Direct Labor Cost 840,000

6 Standard Hours 60,000

x Actual Hours 55,000
Total 5,000
x Standard Rate 14.00
Labor Efficiency Variance 70,000
 Standard Price 15.00
Less: Actual Price of Input (AP) 14.00
Total 1
x Actual Quantity of Input (AQ) 55,000
Materials Quantity Variance (MQV) 55,000

7 Standard Hours 60,000

x Standard Rtae 5.00
Variable Overhead Cost 300,000

8 Standard Hours 60,000

x Actual Hours 55,000
Total 5,000
x Standard Rate 5.00
Variable Overhead Efficiency Variance 25,000

9 Actual Rate (280,500/55,000 hrs) 5.10

Less: Standard Rate 5.00
Total 0
x Actual Hours 55,000
Variable Overhead Efficiency Variable 5,500

10 Preble Company
Spending Variances
For the Month Ended March 31

Units Sold
Expenses:
Advertising (200,000)
Sales Salaries and Commissions (100,000 + (30,000 x 12.00)
Shipping Expenses (30,000 x 3.00)
Total Expenses

11 Actual Results
Less: Flexible Budget
Spending Variance for Sales Salaries and Commissions

12 Actual Results
Less: Flexible Budget
Spending Variance for Advertising
13 Actual Results
Less: Flexible Budget
Spending Variance for Shipping Expenses
pounds

pounds
pounds
pounds

Unfavorable

Unfavorable

pounds
pounds
pounds

Unfavorable

Favorable

per hour

per hour
Favorable
Unfavorable

Favorable

Unfavorable

Flexible
Budget

30,000

200,000
460,000
90,000
750,000

210,000
200,000
10,000 Unfavorable

455,000
460,000
5,000 Favorable
115,000
90,000
25,000 Unfavorable