Direct labor rateDirect labor timeFactory overhead controllableFactory overhead volumeNet variance from standard cost-unfavorableGross profit-actual00 Baxter Company sold 9,200 units at $150 per unit. Normal production is 9,600 units.Standard: 5 yards per unit at $6.30 per yardStandard: 2.00 hours per unit at $16.00Standard: Variable overhead at $1.05 per unit.Standard: Fixed overhead $211,200 (budgeted and actual amount)Actual yards used: 47,020 yards hours at $6.25 per yardActual hours worked: 18,150 hours at $15.90 per hourActual total factory overhead: $236,500Prepare an income statement that includes variances for the year ending December 31 through gross profit for Baxter Company using the above information. Enter favorable variances as negative numbers. Do notround fixed overhead rate calculation when determining fixed factory overhead volume variance.Baxter CompanyIncome Statement Through Gross ProfitFor the Year Ending December 31Line Item DescriptionSalesCost of goods sold-at standardGross profit-at standardLess variances from standard costDirect materials priceDirect materials quantityDirect labor rateDirect labor timeFactory overhead controllableUnfavorableAmountFavorableAmount000Amount

Variance arises when the actual costs are different from the budgeted costs. The results are…

Answered: Baxter Company sold 9,200 units at $150…

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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Langley Manufacturing Ltd. has budgeted fixed manufacturing overhead at $100,000 and per unit variable costs of $3.50 for Direct Materials; $8.95 for Direct Labourand $4.10 for Variable Overhead. With a relevant range of 10,000 to 15,000 units what are the total costs for activity levels of 10,000 units and 14,000 units, respectively?
Lewis Company calculates its predetermined rates using practical volume, which is 288,000 units. The standard cost system allows 2 direct labor hours per unit produced. Overhead is applied using direct labor hours. The total budgeted overhead is P 3,168,000 of which P 864,000 is fixed overhead. The actual results for the year are as follows: Units produced 296,000 Direct labor 570,000 hours @ P 9 Variable overhead P 2,230,000 Fixed overhead P 872,000 Calculate the fixed overhead volume variance P 32,000 F P 24.000 U P 32,000 U P 24,000 F
LaVerle, Inc., manufactures a product that sells for $480. The variable costs per unit are as follows: Direct materials $160 Direct labor 100 Variable manufacturing overhead 40 During the year, the budgeted fixed manufacturing overhead is estimated to be $100,000, and budgeted fixed selling and administrative costs are expected to be $40,000. Variable selling costs are $20 per unit. Required: a. Determine the break-even point in units. b. Determine the number of units that must be sold to earn $60,000 in profit before taxes. c. Determine the number of units that must be sold to generate an after-tax profit of $60,000 if there is a 40 percent tax rate
Baxter Company sold 9,200 units at $145 per unit. Normal production is 9,600 units. Standard: 5 yards per unit at $6.30 per yard Standard: 2.75 hours per unit at $16.00 Standard: Variable overhead at $1.05 per unit Standard: Fixed overhead $216,000 (budgeted and actual amount) Actual yards used: 47,020 yards at $6.25 per yard Actual hours worked: 25,050 hours at $15.90 per hour Actual total factory overhead: $236,500 Prepare an income statement that includes variances for the year ending December 31 through gross profit for Baxter Company using the above information. Enter favorable variances as negative numbers. Do not round fixed overhead rate calculation when determining fixed factory overhead volume variance. Line Item Description Sales Baxter Company Income Statement Through Gross Profit For the Year Ending December 31 Cost of goods sold-at standard Gross profit-at standard Less variances from standard cost Direct materials price Direct materials quantity Direct labor rate Direct…
CostingTo manufacture 500,000 TBS, the direct material cost per item is AED 120 and material scrap is estimated to be 3.5% of the material costs. The direct labour costs total AED 250,000 and the labour scrap rate is 3% of direct labour cost. The variable overheads are 75 - 80% of direct labour costs and the fixed overloads are 30 - 40% of the variable costs. Packaging, tooling and freight costs are 7.5% of manufacture costs. The company requires a profit of 45% to be successful. Calculate the selling price for one unit of TBS.
[The following information applies to the questions displayed below.] Manuel Company predicts it will operate at 80% of its productive capacity. Its overhead allocation base is DLH and its standard amount per allocation base is 0.5 DLH per unit. The company reports the following for this period. Production (in units) Overhead Variable overhead Fixed overhead Total overhead Flexible Budget at 80% Capacity 51,000 Required 1 Required 2 $ 280,500 51,000 $ 331,500 Actual Results (1) Compute the overhead volume variance. Indicate variance as favorable or unfavorable. Volume variance 45,600 (2) Compute the overhead controllable variance. Indicate variance as favorable or unfavorable. $ 318,200 Complete this question by entering your answers in the tabs below. Volume Variance Compute the overhead volume variance. Indicate variance as favorable or unfavorable. Note: Indicate the effect of the variance by selecting favorable, unfavorable, or no vari
Overhead rate per hour?
A company has the following budgeted and actual cost data for manufacturing 2,000 Product X units: Direct materials $50 per unit Direct labor $40 per unit Variable manufacturing overhead $ 5 $40,000 per year per unit Fixed manufacturing Overhead Product X sells for $200 per unit. Assume no beginning or ending inventories. The Gross Profit for selling 15 Product X units is %24
Kubin Company's relevant range of production is 15,000 to 19,000 units. When it produces and sells 17,000 units, its average costs per unit are as follows: Amount per Unit $ 7.60 $ 4.60 $ 2.10 $ 5.60 $ 4.10 $ 3.10 $ 1.60 $ 1.10 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense Required: 1. If 15,000 units are produced and sold, what is the variable cost per unit produced and sold? 2. If 19,000 units are produced and sold, what is the variable cost per unit produced and sold? 3. If 15,000 units are produced and sold, what is the total amount of variable cost related to the units produced and sold? 4. If 19,000 units are produced and sold, what is the total amount of variable cost related to the units produced and sold? 5. If 15,000 units are produced, what is the average fixed manufacturing cost per unit produced? 6. If 19,000 units are produced,…
Cream Company is expected to utilize 3,000 machine hours with fixed manufacturing overhead budgeted at P1,410 and an estimated variable manufacturing overhead rate of P2.10 per hour. Actual production required 2,700 machine hours, with a total overhead of P7,800. What is the applied manufacturing overhead? A P19,290 B P9,639 P6,939 P20,898
Sedona Company set the following standard costs for one unit of its product for this year. Direct material (15 pounds $3.40 per pound) Direct labor (10 hours e S9.70 per DLH) Veriable overhead (10 hours $4.90 per DLH) Fied overhead (10 hours $2. 00 per DLH) Standard cost per unit $ 51.00 97.00 49.00 20.00 $ 217.00 The $6.90 ($4.90 - $2.00) total overhead rate per direct labor hour (DLH) is based on a predicted activity level of 41,300 units, which is 70% of the factory's capacity of 59,000 units per month. The following monthly flexible budget information Is avallable. Operat ing Levels (K of capacity) 65% 30, 350 383,500 Flexible Budget Budgeted production (units) Rudgeted direct labor (standard hours) Budgeted overhead Varlable overhead Fised overhead Total avertead 41, 300 413,000 75% 44, 250 442, 500 $1,879,150 826,000 $ 2,023, 700 826, 000 $ 2,849, 700 $2,168, 250 126, e00 $ 2,994, 250 $ 2,705, 150 During the current month, the company operated at 65% of capacity, direct labor of…
The following data relates to Potawatomi Corporation's operations for the month. Potawatomi produced 8,500 units and the normal monthly capacity is 20,000 direct labor hours. Direct Material: Standard (5 lbs. @ $2.10/lb.) Actual (39,000 lbs. @ $2.20/lb.) Standard Unit Costs Total Actual Costs $10.50 $85,800 Direct Labor: Standard (2 hrs. @ $12/hr.) $24.00 Actual (18,000 hrs. @ $11.90/hr.) $214,200 Variable Overhead: Standard (2 hrs. @ $4.00/hr.) $8.00 Actual $69,700 Total $42.50 $369,700 Use fork diagrams to calculate the following variances: b. Materials efficiency variance a. Materials price variance C. Labor rate variance e. Variable overhead spending variance f. Variable overhead efficiency variance d. Labor efficiency variance

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