BagitUp Company manufactures paper bags. Consider the following selected data:Direct MaterialsDirect LaborStandards per Paper Bag 550 grams of input at $0.03 per gram 0.07 labor hours at $17 per labor hourActual Performance:Paper Bags Produced and Sold21,000 bagsDirect Materials Purchased and Used 8,000,000 gramsLabor Hours Used1,800 labor hoursTotal Direct Materials Costs$193,000Total Direct Labor Costs$47,800Do not enter dollar signs or commas in the input boxes.Round all answers to the nearest whole number.Enter all variances as positive values.a) Calculate price variance for direct materials.Favorableb) Calculate quantity variance for direct materials.106500Favorablec) Calculate labor rate variance.AUnfavorabled) Calculate efficiency variance for direct labor.5610Unfavorable +

The objective of the question is to calculate the price variance for direct materials, quantity…

Answered: BagitUp Company manufactures paper…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Controller Incorporated produces two basic types of video games, Clash and Slash. Pertinent data follow (DLH = direct labor hour): Clash Slash Sales price (per unit) $ 240 $ 168 Costs (per unit): Direct materials 67 31 Direct labor 36 60 Variable factory overhead (@ $15 per DLH) 60 30 Allocated fixed factory overhead (based on DLHs) 24 12 Marketing expenses (all variable) 35 24 Total costs 222 157 Operating income (per unit) $ 18 $ 11 There is insufficient labor capacity in the plant to meet the combined demand for both Clash and Slash. Both products are produced through the same production departments. The contribution margin per unit for Clash is:
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Controller Incorporated produces two basic types of video games, Clash and Slash. Pertinent data follow (DLH = direct labor hour): Clash Sales price (per unit) $ 430 Slash $ 358 Costs (per unit): Direct materials 86 50 Direct labor 74 98 Variable factory overhead (@ $15 per DLH) 60 30 19 Allocated fixed factory overhead (based on DLHS) Marketing expenses (all variable) 24 12 54 43 Total costs 298 233 Operating income (per unit) $ 132 $ 125 There is insufficient labor capacity (i.e., DLHs) in the plant to meet the combined demand for both Clash and Slash. Both products are produced through the same production departments. In view of the labor shortage, which of the two products is most profitable, and how much is the contribution margin, per DLH? Multiple Choice Slash, $137.00.
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Cordova manufactures three types of stained glass window, cleverly named Products A, B, and C. Information about these products follows: Product A Product B Product C Sales price $ 47.00 $ 57.00 $ 87.00 Variable costs per unit 22.70 12.00 38.70 Fixed costs per unit 9.00 9.00 9.00 Required number of labor hours 1.50 2.50 3.00 Cordova currently is limited to 58,500 labor hours per month. Cordova’s marketing department has determined the following demand for its products: Product A 14,000 units Product B 9,000 units Product C 10,000 units Required:Given the company’s limited resource and expected demand, compute how many units of each product Cordova should produce to maximize its profit. (Enter the products in the sequence of their preferences; the product with first preference should be entered first. Round your answers to the nearest whole number.) Product Units Produced
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ABC Apparels is a clothing retailer. Unit costs associated with one of its products, Product A, are as follows: Direct materials $ 70 Direct manufacturing labor 20 Variable manufacturing overhead 15 Fixed manufacturing overhead 32 Sales commissions (2% of sales) 5 Administrative salaries 16 Total $158 What are the inventoriable costs per unit associated with Product A? $137 $140 $143 $88
A company's standard cost system requires 7,000 direct labor hours per month jg. qtler taproduce 3,500 units of handbags. The management has set 2 standard of using 4.3 yards of direct materials per unit of handbag. Information regarding standard costs is mentioned below: Particulars Total standard direct materials cost Total standard direct labor cost Total standard variable manufacturing overhead (based on direct labor-hours) Amount $54,250 $42,000 $18,200 During November, the company produced 3,600 wits of handbags using 6 960 direct labor hours. Actual cots recordad isthe month of Novemb are ss allows:
Assume the following information appears in the standard cost card for a company that makes only one product: Standard Quantity or Hours Standard Price or Rate Standard Cost Direct materials 5 pounds $ 11.00 per pound $ 55.00 Direct labor 2 hours $ 17.00 per hour $ 34.00 Variable manufacturing overhead 2 hours $ 3.80 per hour $ 7.60 During the most recent period, the following additional information was available: 20,000 pounds of material was purchased at a cost of $10.50 per pound. All of the material that was purchased was used to produce 3,900 units. 8,000 direct labor-hours were recorded at a total cost of $132,000. The actual variable overhead cost incurred during the period was $25,000. Assuming the company uses direct labor-hours to compute its predetermined overhead rate, what is the variable overhead efficiency variance?
Hunt Taxidermy, Inc. is concerned about the taxes pald by the company in 2018. In addition to $7.5 million of taxable Income, the firm received $614,000 of interest on state-issued bonds and $340,000 of dividends on common stock it owns in Oakdale Fashlons, Inc. (Use Iable 23) Calculate Hunt Taxidermy's tax liability. (Enter your answer in dollars not in millions. Round your answer to the nearest dollar amount.) Tax liability
Altanta Industries manufactures gadgets. In the month of March, the company incurred the following: Actual Gadgets produced 10,563 Direct Materials 20,000 purchased pounds 19,000 Direct Materials used pounds Cost of Direct $40,000 Materials purchased 2,463 Direct Labor Hours. hours Total Direct Labor Cost $36,566 The standards for production are: Direct Materials per gadget Cost of Direct Materials per pound Direct Labor per gadget Standards 3 lbs per gadget $5 per pound 18 minutes per gadget (.30 hours) Direct Labor Cost per gadget $6 per gadget What is the Direct Labor Rate Variance? Enter a favorable variance as a positive number. Enter an unfavorable variance as a negative number.
Happy Trails has the following information for its manufacturing: Direct Materials $16 Direct Labor $16 Variable Manufacturing Overhead $3 Fixed Manufacturing Overhead $25 Units Produced 27,000 Units Sold 18,000 Its income statement under absorption costing is: Sales $1,901,000 Beginning Inventory $0 Cost of Goods Manufactured 1,620,000 Cost of Goods Available for Sale $1,620,000 - Ending Inventory 540,000 Cost of Goods Sold $1,080,000 Gross Profit $821,000 -Sales and Admin. Expenses: Variable $108,000 Fixed 200,000 Total Sales and Admin. Expenses $308,000 Net Operating Income $513,000 Prepare an income statement with variable costing and a reconciliation statement between both methods. If an amount box does not require an entry, leave it blank.

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