Edney Company employs a standard cost system for product costing. The per-unit standard cost of its product is:Raw materialsDirect labor (2 direct labor hours x $8.00 per hour)Manufacturing overhead (2 direct labor hours x $12.20 per hour)$ 14.0016.0024.40$ 54.40Total standard cost per unitThe manufacturing overhead rate is based on a normal capacity level of 600,000 direct labor hours. The firm has the following annualmanufacturing overhead budget:VariableFixed$ 3,960,0003,360,000$ 7,320,000Edney incurred $434,550 in direct labor cost for 54,100 direct labor hours to manufacture 26,000 units in November. Other costsincurred in November include $296,000 for fixed manufacturing overhead and $342,000 for variable manufacturing overhead.Required:1. Determine each of the following for November. [Note: Indicate whether each variance is favorable (F) or unfavorable (U).]a. The variable overhead rate (spending) variance.b. The variable overhead efficiency variance.c. The fixed overhead budget (spending) variance.d. The fixed overhead volume variance.e. The total amount of under- or overapplied manufacturing overhead (i.e., the total manufacturing overhead cost variance for theperiod).2. Prepare the following four journal entries:(a) to record actual variable overhead costs,(b) to record actual fixed overhead costs,(c) to record standard overhead costs applied to production, and(d) to record all four overhead cost variances.The company uses a single account, Factory Overhead, to record all overhead costs. Assume that the actual variable manufacturingoverhead consists of utilities payable of $168,000, indirect materials of $112,000 (all materials, direct and indirect, are recorded in asingle account, Materials Inventory), and $62,000 depreciation on factory equipment (determined under the units-of-productionmethod). Assume that the fixed manufacturing overhead consists of accrued salaries of $66,000 and factory depreciation of$230,000. All accrued salaries should be recorded in a single account, Accrued Payroll.3. Prepare the appropriate journal entry to close all manufacturing overhead variances to the cost of goods sold (COGS) account.(Assume the cost variances you calculated above are for the year, not the month.)Complete this question by entering your answers in the tabs below.Required 1 Required 2 Required 3Determine each of the following for November. [Note: Indicate whether each variance is favorable (F) or unfavorable (U).]a. The variable overhead rate (spending) variance.b. The variable overhead efficiency variance.c. The fixed overhead budget (spending) variance.d. The fixed overhead volume variance.e. The total amount of under- or overapplied manufacturing overhead (i.e., the total manufacturing overhead cost variance forthe period).(For all requirements, do not round intermediate calculations. Round your final answers to the nearest whole dollar amount.)1a. The variable overhead rate (spending) variance.1b. The variable overhead efficiency variance.1c. The fixed overhead budget (spending) variance.1d. The fixed overhead volume variance.1e.The total amount of under- or overapplied manufacturing overhead (i.e., thetotal manufacturing overhead cost variance for the period).Show less▲

Name: Edney Company employs a standard cost system for product costing. The
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Description: Edney Company employs a standard cost system for product costing. The per-unit standard cost of its product is:Raw materialsDirect labor (2 direct labor hours x $8.00 per hour)Manufacturing overhead (2 direct labor hours x $12.20 per hour)$ 14.0016.

Variance analysis is the difference between actual costs and budgeted costs of the direct materials,…

Business

Accounting

Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Determine each of the following for November. [Note: Indicate whether each variance is favorable (F) or unfavorable (U).] a. The variable overhead rate (spending) variance. b. The variable overhead efficiency variance. c. The fixed overhead budget (spending) variance. d. The fixed overhead volume variance. e. The total amount of under- or overapplied manufacturing overhead (i.e., the total manufacturing overhead cost variance for the period). (For all requirements, do not round intermediate calculations. Round your final answers to the nearest whole dollar amount.) Show less▲ 1a. The variable overhead rate (spending) variance. 1b. The variable overhead efficiency variance. 1c. The fixed overhead budget (spending) variance. 1d. The fixed overhead volume variance. 1e. The total amount of under- or overapplied manufacturing overhead (i.e., the total manufacturing overhead cost variance for the period)

Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Determine each of the following for November. [Note: Indicate whether each variance is favorable (F) or unfavorable (U).] a. The variable overhead rate (spending) variance. b. The variable overhead efficiency variance. c. The fixed overhead budget (spending) variance. d. The fixed overhead volume variance. e. The total amount of under- or overapplied manufacturing overhead (i.e., the total manufacturing overhead cost variance for the period). (For all requirements, do not round intermediate calculations. Round your final answers to the nearest whole dollar amount.) Show less▲ 1a. The variable overhead rate (spending) variance. 1b. The variable overhead efficiency variance. 1c. The fixed overhead budget (spending) variance. 1d. The fixed overhead volume variance. 1e. The total amount of under- or overapplied manufacturing overhead (i.e., the total manufacturing overhead cost variance for the period)

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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