14. What is the spending variance related to sales salaries and commissions? (Indicate the effect of each variance by selecting "F" fo favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.). Input the amount as a positive value.)
14. What is the spending variance related to sales salaries and commissions? (Indicate the effect of each variance by selecting "F" fo favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.). Input the amount as a positive value.)
Chapter2: Building Blocks Of Managerial Accounting
Section: Chapter Questions
Problem 5EB: Baxter Company has a relevant range of production between 15,000 and 30,000 units. The following...
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Question
![[The following information applies to the questions displayed below.]
Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct
labor-hours and its standard cost card per unit is as follows:
Direct material: 5 pounds at $8.00 per pound
Direct labor: 3 hours at $15 per hour
Variable overhead: 3 hours at $9 per hour
Total standard variable cost per unit
The company also established the following cost formulas for its selling expenses:
Variable
Cost per
Unit Sold
Advertising
Sales salaries and commissions
Shipping expenses
Fixed Cost
per Month
$ 350,000
$ 400,000
$ 40.00
45.00
27.00
$112.00
$ 27.00
$18.00
The planning budget for March was based on producing and selling 21,000 units. However, during March the company
actually produced and sold 26,000 units and incurred the following costs:
a. Purchased 160,000 pounds of raw materials at a cost of $6.50 per pound. All of this material was used in production.
b. Direct-laborers worked 70,000 hours at a rate of $16.00 per hour.
c. Total variable manufacturing overhead for the month was $655,200.
d. Total advertising, sales salaries and commissions, and shipping expenses were $358,000, $530,000, and $265,000,
respectively.
< Prev
14. What is the spending variance related to sales salaries and commissions? (Indicate the effect of each variance by selecting "F" for
favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.). Input the amount as a positive value.)
14 15
of 15
‒‒‒
Next >](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F944561e4-8cc0-410d-b694-ee45d23b08da%2F005fa024-b61e-4ce4-a43f-1b92e5a38ade%2Fa94yegn_processed.jpeg&w=3840&q=75)
Transcribed Image Text:[The following information applies to the questions displayed below.]
Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct
labor-hours and its standard cost card per unit is as follows:
Direct material: 5 pounds at $8.00 per pound
Direct labor: 3 hours at $15 per hour
Variable overhead: 3 hours at $9 per hour
Total standard variable cost per unit
The company also established the following cost formulas for its selling expenses:
Variable
Cost per
Unit Sold
Advertising
Sales salaries and commissions
Shipping expenses
Fixed Cost
per Month
$ 350,000
$ 400,000
$ 40.00
45.00
27.00
$112.00
$ 27.00
$18.00
The planning budget for March was based on producing and selling 21,000 units. However, during March the company
actually produced and sold 26,000 units and incurred the following costs:
a. Purchased 160,000 pounds of raw materials at a cost of $6.50 per pound. All of this material was used in production.
b. Direct-laborers worked 70,000 hours at a rate of $16.00 per hour.
c. Total variable manufacturing overhead for the month was $655,200.
d. Total advertising, sales salaries and commissions, and shipping expenses were $358,000, $530,000, and $265,000,
respectively.
< Prev
14. What is the spending variance related to sales salaries and commissions? (Indicate the effect of each variance by selecting "F" for
favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.). Input the amount as a positive value.)
14 15
of 15
‒‒‒
Next >
![f 15
Advertising
Sales salaries and commissions
Shipping expenses
Fixed Cost
per Month
$ 350,000
$ 400,000
for its selling expenses:
Variable
Cost per
Unit Sold
The planning budget for March was based on producing and selling 21,000 units. However, during March the company
actually produced and sold 26,000 units and incurred the following costs:
Spending variance related to sales salaries and commissions
a. Purchased 160,000 pounds of raw materials at a cost of $6.50 per pound. All of this material was used in production.
b. Direct-laborers worked 70,000 hours at a rate of $16.00 per hour.
c. Total variable manufacturing overhead for the month was $655,200.
d. Total advertising, sales salaries and commissions, and shipping expenses were $358,000, $530,000, and $265,000,
respectively.
X Answer is not complete.
$ 27.00
$18.00
14. What is the spending variance related to sales salaries and commissions? (Indicate the effect of each variance by selecting "F" for
favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.). Input the amount as a positive value.)
< Prev
14 15
F
of 15
MacBook Pro
‒‒‒
‒‒‒
Next >
Re](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F944561e4-8cc0-410d-b694-ee45d23b08da%2F005fa024-b61e-4ce4-a43f-1b92e5a38ade%2Fnu6gse_processed.jpeg&w=3840&q=75)
Transcribed Image Text:f 15
Advertising
Sales salaries and commissions
Shipping expenses
Fixed Cost
per Month
$ 350,000
$ 400,000
for its selling expenses:
Variable
Cost per
Unit Sold
The planning budget for March was based on producing and selling 21,000 units. However, during March the company
actually produced and sold 26,000 units and incurred the following costs:
Spending variance related to sales salaries and commissions
a. Purchased 160,000 pounds of raw materials at a cost of $6.50 per pound. All of this material was used in production.
b. Direct-laborers worked 70,000 hours at a rate of $16.00 per hour.
c. Total variable manufacturing overhead for the month was $655,200.
d. Total advertising, sales salaries and commissions, and shipping expenses were $358,000, $530,000, and $265,000,
respectively.
X Answer is not complete.
$ 27.00
$18.00
14. What is the spending variance related to sales salaries and commissions? (Indicate the effect of each variance by selecting "F" for
favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.). Input the amount as a positive value.)
< Prev
14 15
F
of 15
MacBook Pro
‒‒‒
‒‒‒
Next >
Re
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