Comprehensive Problem #3 Due March 30, 2020, 11:59 pm Below is a standard cost card for Product XYZ, manufactured by Jones Company. Standard quantity Standard price Direct Materials 6 ounces $ .50 per ounce Direct Labor .5 direct labor hours $30.00 per hour Variable Manufacturing Overhead .5 direct labor hours $10.00 per hour Additional information: • Number of units produced 2,000 • Materials: 18,000 ounces were purchased for a total of $10,800, and 15,000 were used to produce the 2,000 units • Labor: 950 direct labor hours were worked at a total cost of $29,450 • Manufacturing Overhead: Total variable manufacturing overhead costs incurred were $9,000 1. Compute (show work to receive credit): a. Materials price and quantity variances (3 points) b. Labor rate, efficiency and spending variances (3 points) c. Manufacturing overhead rate, efficiency and spending variances (3 points) 2. Use the same standard costs and quantity for labor, but assume that instead of the 950 hours provided above, Jones’ production required 1000 hours to produce the 2,000 units. Also, assume that Jones labor rate variance was $3,000 Unfavorable. Compute Jones’ (show work to receive credit): a. Actual total direct labor cost (2 points) b. Actual per hour direct labor cost for Jones (1 point)

1 a) Material Price Variance =$1,800 U

Material Quantity Variance = $1,500 U

b) Labor Rate variance = $950 U

Labor efficiency variance = $1,500 F

Labor spending variance =  $1,500 F

2 a) Actual Total Labor cost = $33,000

  b) Actual per hour labor cost = $33

    Labor cost per unit = $16.5

Explanation:

Material Price = ( Standard price - Actual Price) Actual quantity purchased

                       = ($0.50 -$0.6) * 18,000

                       = $1,800 U

Actual price per ounce = $10,800 / 18,000 ounces = $0.6

Material Quantity  = ( Standard Quantity - Actual Quantity) * Standard Price

                              = (12,000 - 15,000) * $0.50

                              = $1,500 U

Standard Quantity = 6 ounces * 2,000 =12,000 ounces

Labor Rate = (Standard Rate - Actual rate) * Actual hours worked

                  = ($30 - $31) *950

                 = $950 U

Actual Rate = $29450/950 = $31

Labor Efficiency = ( Standard Hours - Actual Hours) * Standard Rate

                          = ( 1000 - 950) $30

                         = $1,500 F

Standard Hours = 0.5 * 2,000 units

Labor Spending Variance = ( Standard Rate * Standard hours) - ( Actual rate * Actual hours)

                                          =($30*1,000) - ($31*950)

                                         = $1,500 F

2 ) Actual total direct labor cost = Actual rate * actual hours

                                                     = $33 * 1,000 = $33,000

labor rate variance =  (Standard Rate - Actual rate) * Actual hours worked

                  -$3,000 = ($30- Actual rate ) 1,000

Step 1 : divide by 1,000 on both sides

                 -$3= $30 - Actual rate

Step 2 : minus $30 on both sides

      -$33 = Actual rate

Step 3 : multiple by -1 on both sides

Actual Rate = $33

Labor cost per unit = $33,000/2000 units = $16.5

the correct answer is:     [c]:     " cyclical unemployment " .

answerboth the short run phillips curve and the aggregate demand and aggregate supply model