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Indiana University, BloomingtonBUS A202Ch10 - with answers.

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A202 Managerial Accounting Sample Exam Questions Chapter 10 1. For the most recent week, Tyra's Trinkets budgeted to make 1,000 units and to use 300 hours of labor. Tyra budgets to pay her employees $15.00 per labor hour. Tyra actually made 900 units and used 200 hours of labor during the most recent week. Tyra paid her employees $2,800 for the 200 hours of labor. What is Tyra's labor efficiency variance for the most recent week? A. $1,700 F B. $2,700 U C. $200 F D. $1,050 F E. None of the above Labor efficiency variance is the difference between the Std Qty Allowed and As If Budget Need SQA x BP and AQ x BP SQA = act qty of units x bud labor hrs per unit assumption = 900 units x (300 hrs / 1,000 units) = 270 hrs AQ = Actual qty x actual labor hrs per unit = 200 hrs (given) BP = $15.00 (given) Labor efficiency variance = (270 - 200) x $15 or (270 x $15) - (200 x $15) = $1,050 F2. JOLO Inc provides you with the following data for the most recent month of operations: Budgeted output 5,000 units Actual output 5,700 units Labor rate variance $9,600 U Labor efficiency variance $6,000 U Budgeted quantity of labor 2 labor hours per unit Budgeted price $10 per labor hour What was the actual labor rate per hour? A. $10.80 B. $9.60 C. $9.20 D. $9.40 E. None of the above What is given? Info to calc SQA = 5,700 units x 2.0 hrs x $10 = $114,000 Since have $6,000 U labor efficiency variance, know that As If = $114,000 + $6,000 = $120,000 Therefore, amt of actual labor hrs to make 5,700 units = $120,000 / $10 = 12,000 actual labor hrs Since have $9,600 U labor rate variance, know that Actual = $120,000 + $9,600 = $129,600 $129,600 / 12,000 labor hours = $10.80 actual labor rate per hour SQA As IF Actual 5,700 5,700 5,700 2.00 11,400 12,000 12,000 $10.00 $10.00 $10.80 $114,000 120,000 129,600 $6,000 U $9,600 UNOTE: The next 5 questions are related. Each question can be answered independent of the other questions. However, knowing how to calculate the answers to earlier questions will help you respond to later questions. 3. The company produces a single product. Below are the budget assumptions (standards) for one unit of the product for the year: 6 pounds of direct materials will be used per unit at a cost of $3.00 per pound Each unit will require 0.8 hours of direct labor. The direct labor rate will be $15.00 per hour. VMOH is allocated (applied) based on direct labor hours at a rate of $3.00 per hour. The budgeted amount of direct materials, direct labor and VMOH costs for the actual units produced during the year were $405,000, $270,000 and $54,000 respectively

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