Marvel Parts, Inc., manufactures auto accessories. One of the company's products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,030 hours each month to produce 2,060 sets of covers. The standard costs associated with this level of production are: Per Set Total of Covers Direct materials $39,140 $ 19.00 Direct labor $ 9,270 4.50 Variable manufacturing overhead (based on direct labor-hours) $ 3,502 1.70 $25.20
Q: Using machine-hours to allocate production overhead, complete the income statement for Ellis…
A: Activity-based costing is an approach which helps in allocating the overhead cost to the products or…
Q: to fit nearly any small car. The company has a standard cost system in use for all of its products.…
A: Solution 1: Direct Material Cost Variance Actual Cost Standard cost…
Q: Howard Motors manufactures specialty tractors. It has two divisions: a Tractor Division and a Tire…
A: The transfer price is required to be determined for internal transfers within the company. The…
Q: XYZ Corporation manufactures and sells electronic gadgets. The company uses a standard cost system…
A: Solution:a) Direct Materials Variances: Direct Materials Price Variance = (Actual Price - Standard…
Q: Martinez Products manufactures a line of desk chairs. Martinez's production operations are divided…
A: Process costing is used where the product is generated through multiple processes. It is mainly used…
Q: Marvel Parts, Incorporated, manufactures auto accessories. One of the company’s products is a set of…
A: Introduction: Variance analysis is a quantitative assessment of the difference between actual and…
Q: Liu Incorporated is considering whether to continue to make a component or to buy it from an outside…
A: Lets understand the basics.Management needs to make decision between the make or buy decision…
Q: undle Electronics currently produces the shipping containers it uses to deliver the electronics…
A: Variable costs are costs that vary with the change in the level of output whereas fixed costs are…
Q: Perez Electronics currently produces the shipping containers it uses to deliver the electronics…
A: a. Total relevant cost = Unit-level materials + Unit-level labor + Unit-level overhead +…
Q: Beto Company pays $3.10 per unit to buy a part for one of the products it manufactures. With excess…
A: The differential analysis is prepared to compare the different alternatives available with the…
Q: Dapper Dan produces a man's suit that sells for $200. Although the company's production capacity is…
A: The net income or loss is calculated as the difference between the sales and total costs. The annual…
Q: Ryan Corporation manufactures auto steering systems. Prime cost and machine time estimates for one…
A: Overhead costs are the usual business costs incurred by the organization to run the business. These…
Q: Morrison Manufacturing produces casings for sewing machines: large and small. To produce the…
A: Answer: As per given - Morrison Manufacturing produces casings for sewing machines: large and small.…
Q: would be 80% of direct labor cost. (a) Prepare a make or buy analysis of costs for this part. (Enter…
A: Requirement:- 1)Preparation of a make or buy analysis of costs for this unit as follows under:-
Q: o, Inc., which uses a volume-based cost system, produces cat condos, and has a gross profit margin…
A: The direct costs of producing the goods sold by a company are referred to as the cost of goods sold…
Q: Waterway Engine Incorporated produces engines for the watercraft industry. An outside manufacturer…
A: The relevant cost is the cost which is considered important for decision-making. The irrelevant…
Q: Marvel Parts, Incorporated, manufactures auto accessories. One of the company's products is a set of…
A: The variance is the difference between the standard and actual cost data. The variance can be…
Q: Fogerty Company makes two products—titanium Hubs and Sprockets. Data regarding the two products…
A: Meaning of Activity based costing: Activity based costing means all indirect expense should be…
Q: Waterway Engine Incorporated produces engines for the watercraft industry. An outside manufacturer…
A: Relevant cost:The costs or expenses that will be affected by certain management decision is known as…
Q: Vernon Electronics currently produces the shipping containers it uses to deliver the electronics…
A: Buy cost is the cost of purchasing the product from outside.Make cost is the cost of making/…
Q: rhead ad, traceable ad, allocated Per Unit $ 18 9 2 9* 12 $ 50 18,000 Units Per Year $ 324,000…
A: In Make vs buy analysis , only relevant cost must be considered. Relevant cost are those cost that…
Q: Marvel Parts, Inc., manufactures auto accessories. One of the company’s products is a set of seat…
A: The variance analysis identifies the difference between the budgeted and actual performance. The…
Q: Ryan Corporation manufactures auto steering systems. Prime cost and machine time estimates for one…
A: A predetermined overhead rate is calculated at the start of the accounting period by dividing the…
Q: ompany manufactures two products called Alpha and Beta that sell for $185 and $120, respectively.…
A: Solution: Alpha Beta Sales Price 185 120 Variable costs: Direct materials 30 10…
Q: Marvel Parts, Incorporated, manufactures auto accessories. One of the company’s products is a set of…
A: Variance means the difference between the standard and actual costs. In other words, the variation…
Q: Marvel Parts, Incorporated, manufactures auto accessories. One of the company's products is a set of…
A: The variance is the difference between the standard and actual cost data. The variance can be…
Q: Troy Engines, Limited, manufactures a variety of engines for use in heavy equipment. The company has…
A: The relevant cost refers to the cost which differs between the two alternatives. If the cost does…
Q: Marvel Parts, Inc., manufactures auto accessories. One of the company’s products is a set of seat…
A: Standard hour per set of cover = Total budgeted hours / Total budgeted set = 1,035 hours / 2,070…
Q: lata Company produces two products: a mostly handcrafted soft leather briefcase sold under the label…
A: Consumption ratio is calculated by dividing activity usage by total usage. Plant Wide Overhead…
Q: Sardi Inc. is considering whether to continue to make a component or to buy it from an outside…
A: Make or Buy Decision making When Machine hours/Other production capacity is limited, then machine…
Q: Sardi Incorporated is considering whether to continue to make a component or to buy it from an…
A: Manufacturing costs that vary roughly in response to shifts in production output are referred to as…
Q: Martinez Products manufactures a line of desk chairs. Martinez's production operations are divided…
A: Given, Units produced = 26,300 units Department 1 cost = $860,500 Department 2 cost = $295,000
Q: Box Springs, Inc., makes two sizes of box springs: twin and double. The direct material for the twin…
A: Total cost of jobs refers to the cost of all jobs involved.
Q: Marvel Parts, Incorporated, manufactures auto accessories including a set of seat covers that can be…
A: Lets understand the basics.The variance is the difference between the standard and actual cost data.…
Q: Beto Company pays $6.50 per unit to buy a part for one of the products it manufactures. With excess…
A: MAKE OR BUY DECISIONThe make-or-buy decision is choosing between manufacturing a product within a…
Q: Marvel Parts, Incorporated, manufactures auto accessories. One of the company's products is a set of…
A: Working Notes:For Material VariancesStandard -2,100 Set of CoversActual- 2,100 Set of CoversStandard…
Q: A. Assume that Cane expects to produce and sell 88,000 Alphas during the current year. A supplier…
A: Make and buy decision refers to a decision taken the manager whether to product the required…
Q: Marvel Parts, Incorporated, manufactures auto accessories. One of the company’s products is a set of…
A: Overhead expenses are the ones that a company pays but that not directly related to a product or…
Q: Penagos Corporation is presently making part Z43 that is used in one of its products. A total of…
A: Relevant cost is the cost which is relevant in decision making. It is managerial accounting term. It…
Q: Required a. Calculate the total relevant cost. Should Campbell continue to make the containers? b.…
A: A make-or-buy choice is made while deciding whether to manufacture a product internally or to buy it…
Q: DirectLabor-Hours per Unit AnnualProduction Hubs 0.70 19,000 units Sprockets 0.30 47,000 units…
A: 1.Compute the activity rate for each activity cost pool. Activity Cost Pool Estimated Overhead…
Q: Box Springs, Inc., makes two sizes of box springs: twin and double. The direct material for the twin…
A: Job costing is a way of accounting that allows you to keep a record of the costs of different tasks…
Q: Beto Company pays $3.50 per unit to buy a part for one of the products it manufactures. With excess…
A: Making or buy analysis deciding if to manufacture the product in-house or to purchase it from a…
Q: Jordan Electronics currently produces the shipping containers it uses to deliver the electronics…
A: A make-or-buy choice is made while deciding whether to manufacture a product internally or to buy it…
Q: Marvel Parts, Incorporated, manufactures auto accessories. One of the company's products is a set of…
A: The variance is the difference between the standard and actual cost data. The variance can be…
Q: Beto Company pays $7.30 per unit to buy a part for one of the products it manufactures. With excess…
A: MAKE OR BUY DECISIONThe make-or-buy decision is choosing between manufacturing a product within a…
Q: Cane Company manufactures two products called Alpha and Beta that sell for $140 and $100,…
A: To determine the financial advantage or disadvantage of discontinuing the Beta product line, we need…
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
- Marvel Parts, Incorporated, manufactures auto accessories. One of the company’s products is a set of seat covers that can be adjusted to fit nearly any small car. The company uses a standard cost system for all of its products. According to the standards that have been set for the seat covers, the factory should work 2,850 hours each month to produce 1,900 sets of covers. The standard costs associated with this level of production are: Total Per Set of Covers Direct materials $ 42,560 $ 22.40 Direct labor $ 51,300 27.00 Variable manufacturing overhead (based on direct labor-hours) $ 6,840 3.60 $ 53.00 During August, the factory worked only 2,800 direct labor-hours and produced 2,000 sets of covers. The following actual costs were recorded during the month: Total Per Set of Covers Direct materials (12,000 yards) $ 45,600 $ 22.80 Direct labor $ 49,000 24.50 Variable manufacturing overhead $ 7,000 3.50 $ 50.80 At standard, each set of covers…Troy Engines, Limited, manufactures a variety of engines for use in heavy equipment. The company has always produced all of the parts for its engines, including the carburetors. An outside supplier offered to sell one type of carburetor to Troy Engines, Limited, for a cost of $30 per unit. To evaluate this offer, Troy Engines, Limited, summarized the cost of producing the carburetor internally as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead, traceable Fixed manufacturing overhead, allocated Total cost Per Unit $ 12 8 2 9* Required 1 Required 2 Required 3 Required 4 12 $43 *One-third supervisory salaries; two-thirds depreciation of special equipment (no resale value). Required: 1. If the company has no alternative use for the facilities being used to produce the carburetors, what would be the financial advantage (disadvantage) of buying 12,000 carburetors from the outside supplier? 2. Should the outside supplier's offer be accepted?…Cooper's Bags Company manufactures cloth grocery bags to be sold to grocery stores and other retailers. Cooper's Bags Company sells the bags in cases of 1500 bags. The bags come in three sizes: Large, Medium, and Small. Currently, Cooper's Bags Company uses a single plant-wide overhead rate to allocate its $7,705,000 of annual manufacturing overhead. Of this amount, $2,260,000 is associated with the Large Bag line, $3,418,000 is associated with the Medium Bag line, and $2,027,000 is associated with the Small Bag line. Cooper's Bags Company is currently running a total of 44,000 machine hours: 14,000 in the Large Bag line, 15,900 in the Medium Bag line, and 14,100 in the Small Bag line. Cooper's Bags Company uses machine hours as the cost driver for manufacturing overhead costs. The plant-wide manufacturing overhead rate would be closest to
- Rooney Electronics currently produces the shipping containers it uses to deliver the electronics products it sells. The monthly cost of producing 9,100 containers follows. Unit-level materials Unit-level labor Unit-level overhead Product-level costs* $ 5,200 6,500 3,600 9,300 26,600 Allocated facility-level costs *One-third of these costs can be avoided by purchasing the containers. Russo Container Company has offered to sell comparable containers to Rooney for $2.70 each. Required a. Calculate the total relevant cost. Should Rooney continue to make the containers? b. Rooney could lease the space it currently uses in the manufacturing process. If leasing would produce $11,500 per month, calculate the total avoidable costs. Should Rooney continue to make the containers? a. Total relevant cost Should Rooney continue to make the containers? b. Total avoidable cost Should Rooney continue to make the containers?Marvel Parts, Incorporated, manufactures auto accessories including a set of seat covers that can be adjusted to fit most cars. According to its standards, the factory should work 1,075 hours each month to produce 2,150 sets of seat covers. The standard costs associated with this level of production are: Total Direct materials $ 54,825 Direct labor $ 10,750 Per Set of Covers $ 25.50 5.00 Variable manufacturing overhead (based on direct labor-hours) $ 5,375 2.50 $ 33.00 During August, the factory worked 800 direct labor-hours and produced 2,500 sets of covers. The following actual costs were recorded during the month: Total Direct materials (12,500 yards) Direct labor $ 58,750 $ 13,000 Variable manufacturing overhead $ 7,000 Per Set of Covers $ 23.50 5.20 2.80 $ 31.50 At standard, each set of covers should require 3.0 yards of material. All of the materials purchased during the month were used in production. Required: 1. Compute the materials price and quantity variances for August. 2.…Hot Dog Express (HDE) is currently buying their buns from Buns-For-All for $. 50 a dozen. Each month they purchase 14,000 dozen. HDE is considering making their own buns for cost cutting and quality reasons. They have determined the following costs: materials, $. 20; direct labor, $. 10; variable factory overhead cost, $. 04; and total (existing) fixed costs, $3,000 per month. From an accounting point of view only, should HDE make or buy their buns?
- Troy Engines, Limited, manufactures a variety of engines for use in heavy equipment. The company has always produced all of the parts for its engines, including the carburetors. An outside supplier offered to sell one type of carburetor to Troy Engines, Limited, for a cost of $30 per unit. To evaluate this offer, Troy Engines, Limited, summarized the cost of producing the carburetor internally as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead, traceable Fixed manufacturing overhead, allocated Total cost Per 19,000 Units Unit Per Year $ 12 $ 228,000 10 3 190,000 57,000 3* 6 57,000 114,000 $ 34 $ 646,000 "One-third supervisory salaries; two-thirds depreciation of special equipment (no resale value). Required: 1. If the company has no alternative use for the facilities being used to produce the carburetors, what would be the financial advantage (disadvantage) of buying 19,000 carburetors from the outside supplier? 2. Should the outside…Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours per Unit Hubs Sprockets Additional information about the company follows: a. Hubs require $36 in direct materials per unit, and Sprockets require $10. b. The direct labor wage rate is $13 per hour. c. Hubs require special equipment and are more complex to manufacture than Sprockets. d. The ABC system has the following activity cost pools: 0.80 0.40 Annual Production 20,000 units 50,000 units Activity Cost Pool (Activity Measure) Machine setups (number of setups) Special processing (machine-hours) General factory (organization-sustaining) Required 1 Required 2 Required: 1. Compute the activity rate for each activity cost pool. 2. Determine the unit product cost of each product according to the ABC system. Complete this question by entering your answers in the tabs below. Compute the activity rate for each activity cost pool. Activity Cost Pool Machine setups Special…Marvel Parts, Incorporated, manufactures auto accessories.One of the company's products is a set of seat covers that can be adjusted to fit nearly any small car. The company uses a standard cost system for all of its products. According to the standards that have been set for the seat covers, the factory should work 2, 850 hours each month to produce 1,900 sets of covers. The standard costs associated with this level of production are: Total Per Set of Covers Direct materials $ 42, 560 $ 22.40 Direct labor $ 51,300 27.00 Variable manufacturing overhead (Training Training hing based on direct labor-hours) $ 6,840 3.60 $ 53.00 During August, the factory worked only 2, 800 direct labor-hours and produced 2,000 sets of covers. The following actual costs were recorded during the month: Total Per Set of Covers Direct materials (12, 000 yards) $ $ 45,600 $ 22.80 Direct labor $ 49,000 24.50 Variable manufacturing overhead $ 7,000 3.50 $ 50.80 At standard, each set of covers should require 5.6…
- Marvel Parts, Incorporated, manufactures auto accessories. One of the company's products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 990 hours each month to produce 1,980 sets of covers. The standard costs associated with this level of production are: Direct materials Total $ 45,738 Direct labor $ 6,930 Per Set of Covers $ 23.10 3.50 Variable manufacturing overhead (based on direct labor-hours) $ 3,168 1.60 $ 28.20 During August, the factory worked only 1,000 direct labor-hours and produced 2,500 sets of covers. The following actual costs were recorded during the month: Direct materials (10,000 yards) Direct labor Variable manufacturing overhead Total $ 56,000 $ 9,250 $ 4,500 Per Set of Covers $22.40 3.70 1.80 $ 27.90 At standard, each set of covers should require 3.3 yards of material. All of the…Marvel Parts, Incorporated, manufactures auto accessories. One of the company's products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,005 hours each month to produce 2,010 sets of covers. The standard costs associated with this level of production are: Direct materials Direct labor Variable manufacturing overhead (based on direct labor-hours) Direct materials (6,000 yards) Direct labor Variable manufacturing overhead Total $28,542 $ 8,040 $ 3,618 During August, the factory worked only 1,200 direct labor-hours and produced 2,600 sets of covers. The following actual costs were recorded during the month: Per Set of Covers $ 14.20 4.00 Total $ 35,100 $ 10,920 $ 5,460 1. Materials price variance 1. Materials quantity variance 2. Labor rate variance 1.80 $ 20.00 2. Labor efficiency variance 3. Variable…Marvel Parts, Incorporated, manufactures auto accessories. One of the company's products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,040 hours each month to produce 2,080 sets of covers. The standard costs associated with this level of production are: Direct materials. Direct labor Variable manufacturing overhead (based on direct labor-hours) Direct materials (5,000 yards) Direct labor Variable manufacturing overhead Total $ 40,560 $ 7,280 $ 4,160 During August, the factory worked only 600 direct labor-hours and produced 1,800 sets of covers. The following actual costs were recorded during the month: Per Set of Covers $19.50 3.50 Total $ 34,200 $ 6,660 $ 4,140 2.00 $ 25.00 1. Materials price variance 1. Materials quantity variance 2. Labor rate variance 2. Labor efficiency variance 3. Variable…