Helix Company Produces

Topics: Cost, Variable cost, Costs Pages: 4 (819 words) Published: April 8, 2013
Helix Company produces several products in its factory, including a karate robe. The company uses a standard cost system to assist in the control of costs. According to the standards that have been set for the robes, the factory should work 780 direct labour-hours each month and produce 2600 robes. The standard costs associated with this level of production are as follows:|   

 | Total| Per Unit
of Product|
  Direct materials| $| 53248  | $ 20.48   |
  Direct labour| $| 8320  | 3.20   |
  Variable manufacturing overhead
  (based on direct labour-hours)| $| 3120  | 1.20   |  |  |  | |
 |  |  | $ 24.88   |
 |  |  | |
|
  
    During April, the factory worked only 760 direct labour-hours and produced 2700 robes. The following actual costs were recorded during the month:|   
 | Total| Per Unit
of Product|
  Direct materials (9180 yards)| $| 55080  | $ 20.40   |   Direct labour| $| 9180  | 3.40   |
  Variable manufacturing overhead| $| 5400  | 2.00   |  |  |  | |
 |  |  | $ 25.80   |
 |  |  | |
|
  
At standard, each robe should require 3.2 yards of material. All of the materials purchased during the month were used in production.|

Required:|
1.| Compute the materials price and quantity variances for April: (Input all amounts as positive values. Leave no cells blank - be certain to enter "0" wherever required. Indicate the effect of each variance by selecting "F" for favourable, "U" for unfavourable, and "None" for no effect (i.e., zero variance). Round your intermediate calculations to 2 decimal places and final answers to the nearest whole dollar.)|

 |  |  |
  Materials price variance| $ 216 |   F |
  Materials quantity variance| $ 2048 |   F |
|

2.| Compute the labour rate and efficiency variances for April:(Input all amounts as positive values. Leave no cells blank - be certain to enter "0" wherever required. Indicate the effect of...
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