High fliers company produces model airplanes during the

Assignment Help Accounting Basics

Reference no: EM13603109

1.The Perfect Tool Company (South America Division) produced 80,000 saw blades during the year. It took 1.5 hours of labor per blade at a rate of $8.50 per hour. However, its standard labor rate is $8.00. Its labor efficiency variance was an unfavorable $40,000. What is Perfect's labor rate variance?

A) $57,500 U

B) $57,500 F

C) $60,000 U

D) $60,000 F

2.Which of the following is true regarding the disposition of materials and labor variances?

A) The variances for materials and labor are closed directly to Cost of Goods Sold regardless of materiality.

B) If the materials price variance is material, it is prorated among Materials Inventory, Materials Usage Variance, Work in Process, and Finished Goods

C) The materials usage variance and the labor variances, if material, are prorated among Work in Process, Finished Goods, and Cost of Goods Sold.

D) The materials usage variance and the labor variances are always prorated among Work in Process, Finished Goods, and Cost of Goods Sold.

E) The materials usage variance and the labor variances are always closed to Cost of Goods Sold.

3.Extreme Builders constructs houses. The standard labor rate is $25 per hour and the standard number of hours is 15,000 hours per home. During the year, it constructed 12 homes using 18,000 labor hours per home and a rate of $28 per hour. Calculate the labor efficiency variance.

A) $1,008,000 F

B) $900,000 U

C) $1,008,000 U

D) $900,000 F

4.High Fliers Company produces model airplanes. During the month of November, it produced 2,000 planes. The actual labor hours were 7 hours per plane. Its standard labor hours are 10 hours per plane. The standard labor rate is $11 per hour. At the end of November, High Fliers found that it had a favorable labor rate variance of $10,500. What was High Fliers' total labor variance?

A) $61,500 F

B) $76,500 F

C) $76,500 U

D) $61,500 U

Reference no: EM13603109

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