Fischer Fabrication reported the following information concerning its direct materials: Direct materials purchased (actual) Standard cost of materials purchased Standard price times actual amount of materials used Actual production Standard direct materials costs per unit produced $365,700 $ 352,500 $ 324,500 55,100 units $6 Assume that Fischer Fabrication had no beginning finished goods inventory and only produced one product. A count of inventory showed that 4,408 units remained in the warehouse. Required: a. Assume Fischer writes off all variances to Cost of Goods Sold. Prepare the entries Fischer would make to record and close out the variances. b. Assume Fischer prorates all variances to the appropriate accounts. Prepare the entries Fischer would make to record and close out the variances.
Fischer Fabrication reported the following information concerning its direct materials: Direct materials purchased (actual) Standard cost of materials purchased Standard price times actual amount of materials used Actual production Standard direct materials costs per unit produced $365,700 $ 352,500 $ 324,500 55,100 units $6 Assume that Fischer Fabrication had no beginning finished goods inventory and only produced one product. A count of inventory showed that 4,408 units remained in the warehouse. Required: a. Assume Fischer writes off all variances to Cost of Goods Sold. Prepare the entries Fischer would make to record and close out the variances. b. Assume Fischer prorates all variances to the appropriate accounts. Prepare the entries Fischer would make to record and close out the variances.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question

Transcribed Image Text:Exercise 17-23 (Algo) Prorating Direct Materials Cost Variances (LO 17-1)
Fischer Fabrication reported the following information concerning its direct materials:
Direct materials purchased (actual)
Standard cost of materials purchased
Standard price times actual amount of materials used.
Actual production
Standard direct materials costs per unit produced
$365,700
$ 352,500
$ 324,500
55,100 units
$ 6
Assume that Fischer Fabrication had no beginning finished goods inventory and only produced one product. A count of inventory
showed that 4,408 units remained in the warehouse.
Required:
a. Assume Fischer writes off all variances to Cost of Goods Sold. Prepare the entries Fischer would make to record and close out the
variances.
b. Assume Fischer prorates all variances to the appropriate accounts. Prepare the entries Fischer would make to record and close out
the variances.
Expert Solution

This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 5 steps

Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you


Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,

Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,


Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,

Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,

Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON

Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education

Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education