Erwin Espino, a financial analyst for Pettigrw Industries has been giveninformation with respect to standard cost variances for one of the plants. Thesevariances are given below:Materials quantity varianceMaterials price varianceLabor rate varianceP7,000 unfavorable4,000 unfavorableLabor time/efficiency varianceOverhead spending varianceOverhead efficiency varianceOverhead capacity variance12,000 favorable3,000 unfavorable6,000 favorable50,000 unfavorablele has determined that the company has manufactured 50,000 units of productvith standard cost as follows:Direct materialsP700,000*Direct labor300,000**Variable overhead150,000Fixed overhead250,000Total standard costP1,400,000 Standard naw materials per finished product is 5 units*Standard labor time per finished product is 12 minutesThe fixed overhead was in agreement with the budgeted fixed overhead.Erwin would like to use the variances to develop some of the cost data for the fiscalperiodREQUIRED1. Reconstruct the total standard cost per unit of finished product.2. Reconstruct the material and labor variances graphically.3. Reconstruct the flexible overhead budget using the format of page 217.4. Reconstruct the overhead variances.

Name: Erwin Espino, a financial analyst for Pettigrw Industries has been gi
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Description: Erwin Espino, a financial analyst for Pettigrw Industries has been giveninformation with respect to standard cost variances for one of the plants. Thesevariances are given below:Materials quantity varianceMaterials price varianceLabor rate varianceP

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*Standard labor time per finished product is 12 minutes. The fixed overhead was in agreement with the budgeted fixed overhead. Erwin would like to use the variances to develop some of the cost data for the fiscal period REQUIRED 1. Reconstruct the total standard cost per unit of finished product. 2. Reconstruct the material and labor variances graphically. 3. Reconstruct the flexible overhead budget using the format of page 217. 4. Reconstruct the overhead variances.

*Standard labor time per finished product is 12 minutes. The fixed overhead was in agreement with the budgeted fixed overhead. Erwin would like to use the variances to develop some of the cost data for the fiscal period REQUIRED 1. Reconstruct the total standard cost per unit of finished product. 2. Reconstruct the material and labor variances graphically. 3. Reconstruct the flexible overhead budget using the format of page 217. 4. Reconstruct the overhead variances.

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter10: Standard Costing And Variance Analysis

Section: Chapter Questions

Problem 46E: Refer to the information for Cinturon Corporation on the previous page. Required: 1. Break down the...

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The president of McGrade Industries wants an analysis prepared to help explain why the variances computed in requirement 1 occurred. Using the worksheet called PRIMEVAR that follows these requirements, calculate the material and labor variances for McGrade Industries. The problem requires you to enter the input in the Data Section as well as formulas in the Answer Section.
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