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Maple Leaf Production manufactures truck tires. The following information is available for the last operating period. • Maple Leaf produced and sold 93,000 tires for $36 each. Budgeted production was 97,000 tires. Standard variable costs per tire follow. Direct materials: 4 pounds at $2.00 Direct labor: 0.35 hours at $15.00 Variable production overhead: 0.10 machine-hours at $15 per hour Total variable costs • Fixed production overhead costs: Monthly budget $1,458,000 Fixed overhead is applied at the rate of $16.00 per tire. • Actual production costs: Direct materials purchased and used: 397,000 pounds at $1.70 Direct labor: 28,500 hours at $15.30 Variable overhead: 11,000 machine-hours at $15.70 per hour Fixed overhead $ 8.00 5.25 1.50 $14.75 $ 674,900 436,050 172,700 1,459,000 Required: a. Prepare a cost variance analysis for each variable cost for Maple Leaf Productions. b. Prepare a fixed overhead cost variance analysis. c. (Appendix) Prepare the journal entries to record the activity for the last period using standard costing. Assume that all variances are closed to cost of goods sold at the end of the operating period.

Maple Leaf Production manufactures truck tires. The following information is available for the last operating period. • Maple Leaf produced and sold 93,000 tires for $36 each. Budgeted production was 97,000 tires. Standard variable costs per tire follow. Direct materials: 4 pounds at $2.00 Direct labor: 0.35 hours at $15.00 Variable production overhead: 0.10 machine-hours at $15 per hour Total variable costs • Fixed production overhead costs: Monthly budget $1,458,000 Fixed overhead is applied at the rate of $16.00 per tire. • Actual production costs: Direct materials purchased and used: 397,000 pounds at $1.70 Direct labor: 28,500 hours at $15.30 Variable overhead: 11,000 machine-hours at $15.70 per hour Fixed overhead $ 8.00 5.25 1.50 $14.75 $ 674,900 436,050 172,700 1,459,000 Required: a. Prepare a cost variance analysis for each variable cost for Maple Leaf Productions. b. Prepare a fixed overhead cost variance analysis. c. (Appendix) Prepare the journal entries to record the activity for the last period using standard costing. Assume that all variances are closed to cost of goods sold at the end of the operating period.

FINANCIAL ACCOUNTING
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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Maple Leaf Production manufactures truck tires. The following information is available for the last operating period. • Maple Leaf produced and sold 93,000 tires for $36 each. Budgeted production was 97,000 tires. • Standard variable costs per tire follow. Direct materials: 4 pounds at $2.00 Direct labor: 0.35 hours at $15.00 Variable production overhead: 0.10 machine-hours at $15 per hour Total variable costs Fixed production overhead costs: Monthly budget $1,458,000 • Fixed overhead is applied at the rate of $16.00 per tire. • Actual production costs: Direct materials purchased and used: 397,000 pounds at $1.70 Direct labor: 28,500 hours at $15.30 Variable ve id: 11,000 machine-hours at $15.70 per hour Fixed overhead $ 8.00 5.25 1.50 $14.75 $ 674,900 436,050 172,700 1,459,000 Required: a. Prepare a cost variance analysis for each variable cost for Maple Leaf Productions. b. Prepare a fixed overhead cost variance analysis. c.(Appendix) Prepare the journal entries to record the activity for the last period using standard costing. Assume that all variances are closed to cost of goods sold at the end of the operating period.
Transcribed Image Text:Maple Leaf Production manufactures truck tires. The following information is available for the last operating period. • Maple Leaf produced and sold 93,000 tires for $36 each. Budgeted production was 97,000 tires. • Standard variable costs per tire follow. Direct materials: 4 pounds at $2.00 Direct labor: 0.35 hours at $15.00 Variable production overhead: 0.10 machine-hours at $15 per hour Total variable costs Fixed production overhead costs: Monthly budget $1,458,000 • Fixed overhead is applied at the rate of $16.00 per tire. • Actual production costs: Direct materials purchased and used: 397,000 pounds at $1.70 Direct labor: 28,500 hours at $15.30 Variable ve id: 11,000 machine-hours at $15.70 per hour Fixed overhead $ 8.00 5.25 1.50 $14.75 $ 674,900 436,050 172,700 1,459,000 Required: a. Prepare a cost variance analysis for each variable cost for Maple Leaf Productions. b. Prepare a fixed overhead cost variance analysis. c.(Appendix) Prepare the journal entries to record the activity for the last period using standard costing. Assume that all variances are closed to cost of goods sold at the end of the operating period.
Required A Required B Required C Prepare a cost variance analysis for each variable cost for Maple Leaf Productions. (Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.) Direct Materials Direct Labor Variable Overhead Actual costs Actual inputs at standard price Flexible budget Price variance Efficiency variance Cost variance Show Transcribed Text Required A Required B Required C Prepare a fixed overhead cost variance analysis. (Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.) Total fixed overhead cost variance Show Transcribed Text View transaction list Required A Required B (Appendix) Prepare the journal entries to record the activity for the last period using standard costing. Assume that all variances are closed to cost of goods sold at the end of the operating period. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Required C S Journal entry worksheet < A B C D E F G H Note: Enter debits before credits. Event 1 3 Record entry for direct material costs payable and material variances. General Journal H ..... Debit L Credit >
Transcribed Image Text:Required A Required B Required C Prepare a cost variance analysis for each variable cost for Maple Leaf Productions. (Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.) Direct Materials Direct Labor Variable Overhead Actual costs Actual inputs at standard price Flexible budget Price variance Efficiency variance Cost variance Show Transcribed Text Required A Required B Required C Prepare a fixed overhead cost variance analysis. (Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.) Total fixed overhead cost variance Show Transcribed Text View transaction list Required A Required B (Appendix) Prepare the journal entries to record the activity for the last period using standard costing. Assume that all variances are closed to cost of goods sold at the end of the operating period. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Required C S Journal entry worksheet < A B C D E F G H Note: Enter debits before credits. Event 1 3 Record entry for direct material costs payable and material variances. General Journal H ..... Debit L Credit >
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