9.The Jurcevich Corporation manufactures and sells a single product. A

Question : 9.The Jurcevich Corporation manufactures and sells a single product. A : 1416272


9.The Jurcevich Corporation manufactures and sells a single product. A standard cost system is used by the company.  The standard factory overhead cost for a unit of product is as follows:

Variable overhead (1.5 hours @ $3 per hour)4.50

Fixed overhead (1.5 hours @ $1 per hour)1.50

Total standard cost per unit$6.00


The overhead cost per unit was calculated for the year based on a 60,000 unit volume as follows:


Variable factory overhead cost:

Indirect labor (30,000 hours @ $8)$240,000

Factory supplies (60,000 gallons of oil @ $.80 per gallon)48,000

Allocated variable service costs from other departments12,000

Total variable costs$300,000

Fixed overhead costs:

Supervision$ 28,000


Other fixed costs12,000

Total fixed overhead costs$ 90,000

Total annual factory overhead budget for 60,000 units$390,000


The charges to the manufacturing department for April are given below for the 5,200 units produced:


Indirect labor (2,400 hrs. @ $8.15 per hr.)$19,560

Factory supplies (6,000 gallons @ $.55)3,300

Allocated variable service department costs3,200



Other fixed costs1,000



(a)  Assuming Jurcevich uses the two-variance method of analyzing factory overhead, calculate the following variances from standard cost:

(1)Factory overhead controllable variance

(2)Factory overhead volume variance

(b)  Prepare the journal entry to apply factory overhead to work in process and record the variances.

10.Palek Company has adopted the following standards:


Input  Total

Direct materials3 lbs. @ $3.60 per lb.$10.80

Direct labor5 hrs. @ $12.00 per hr.60.00

Factory overhead:

Variable$4.00 per direct labor hour20.00

Fixed$5.00 per direct labor hour25.0045.00

Standard cost per unit$115.50


Palek's January budget was based on normal volume of 40,000 standard labor hours.  During January, Palek produced 7,900 units with records indicating the following data:


Direct materials purchased25,000lbs. @ $3.65

Direct materials used23,400lbs.

Direct labor39,900hrs. @ $11.85

Factory overhead$375,000

Fixed factory overhead$210,000


Assuming Palek uses the four-variance method of analyzing factory overhead, compute the following variances for the month of January and indicate whether each is favorable or unfavorable:


a.Factory overhead spending variance

b.Factory overhead efficiency variance

c.Factory overhead budget variance

d.Factory overhead volume variance



5 (1 Ratings )

Accounting 3 Years Ago 212 Views
This Question has Been Answered!

Related Answers
Unlimited Access Free
Explore More than 2 Million+
  • Textbook Solutions
  • Flashcards
  • Homework Answers
  • Documents
Signup for Instant Access!
Ask an Expert
Our Experts can answer your tough homework and study questions
150417 Accounting Questions Answered!
Post a Question