Megan, Incorporated uses the following standard costs per unit for one of its products: Direct labor (2.0 hours @ $5.00 per hour) = $10.00; overhead (2.0 hours @ $2.50 per hour) = $5.00. The flexible budget foroverhead is $120,000 plus $1.00 per direct labor hour (DLH). Actual data for the past month show total overhead costs of $222,000, total fixed overhead of $122,000, 77,000 hours worked, and 40,000 units produced.The fixed overhead spending variance for Megan, Incorporated for the past month was:Multiple Choice$0.$2,000 unfavorable.$4,000 unfavorable.$16,000 unfavorable.$24,000 unfavorable.

Budgeted fixed overhead is given as 120,000.Actual fixed overhead costs reported are 122,000. Fixed…

Answered: Megan, Incorporated uses the following…

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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Ravine Ltd determines the price of jobs using time and material pricing. Budgeted information relating to this accounting period is as follows: Labour rate, including on-costs 60 Annual labour hours 15,000 Annual overhead costs: Material handling and storage 151,680 Other overhead costs 546,000 Annual cost of materials used 1,264,000 Ravine Ltd adds a mark-up of $20 per hour on time charges, while no mark-up is added onto material costs. Required: Calculate the price for a job that requires 300 labour hours and $180,000 material cost. What would be the price of the job if Ravine Ltd also added a 10% mark-up on all material charges?
Cadux Candy Company's income statement for the year ended December 31, 2024, reported interest expense of $3 million and income tax expense of $20 million. Current assets listed in its balance sheet include cash, accounts receivable, and inventory. Property, plant, and equipment is the company's only noncurrent asset. Financial ratios for 2024 are listed below. Profitability and turnover ratios with balance sheet items in the denominator were calculated using year-end balances rather than averages. Debt to equity ratio Current ratio 0.8 2.0 Acid-test ratio 1.0 Times interest earned ratio 16 times Return on assets 20% Return on equity 36% Profit margin on sales 10% Gross profit margin (gross profit divided by net sales) 20% Inventory turnover 8 times Receivables turnover 21 times Required: Prepare a December 31, 2024, balance sheet for the Cadux Candy Company. Note: Enter your answers in millions. Round your intermediate calculations and final answer to the nearest whole million. CADUX…
Concord Company's overhead rate was based on estimates of $1,008,000 for overhead costs and 84,000 direct labor hours. Concord's standards allow 2 hours of direct labor per unit produced. Production in May was 3,560 units, and actual overhead incurred in May was $86,510. The overhead budgeted for 7,120 standard direct labor hours is $85,200 ($14,000 fixed and $71,200 variable). (a) Compute the total, controllable, and volume variances for overhead. Total Overhead Variance $ Overhead Controllable Variance $ Overhead Volume Variance +A $
Myers Company uses a flexible budget for manufacturing overhead based on direct labor hours. Variable manufacturing overhead costs per direct labor hour are as follows: Indirect labor Indirect materials Utilities Activity Level Depreciation Fixed overhead costs per month are Supervision $3,600, Depreciation $1,300, and Property Taxes $800. The company believes it will normally operate in a range of 7,100-11,000 direct labor hours per month. Direct Labor Hours Fixed Costs $1.20 Prepare a monthly manufacturing overhead flexible budget for 2020 for the expected range of activity, using increments of 1,300 direct labor hours. (List variable costs before fixed costs.) Indirect Labor Indirect Materials Property Taxes Supervision 0.70 Total Costs Total Fixed Costs Total Variable Costs Utilities Variable Costs 0.20 LA MYERS COMPANY Monthly Manufacturing Overhead Flexible Budget For the Year 2020 LA tA tA
Novak Company uses a flexible budget for manufacturing overhead based on direct labor hours. Variable manufacturing overhead costs per direct labor hour are as follows: Indirect labor: $1.10, Indirect materials: 0.80, Utilities 0.50. Fbed overhead costs per month are Supervision $4,000, Depreciation $1, 200, and Property Taxes $800. The company believes it will normally operate in a range of 7, 000-10,000 direct labor hours per month. Prepare a monthly manufacturing overhead flexible budget for 2022 for the expected range of activity, using increments of 1, 000 direct labor hours. (List variable costs before fixed costs)
< Deluxe, Inc. uses a standard cost system and provides the following information. (Click the icon to view the information.) Deluxe allocates manufacturing overhead to production based on standard direct labor hours. Deluxe reported the following actual results for 2024: actual number of units produced, 1,000, actual variable overhead, $5,000, actual fixed overhead, $3,200; actual direct labor hours, 1,400. Read the requirements Data table Static budget variable overhead Static budget fixed overhead Static budget direct labor hours Static budget number of units Standard direct labor hours Print The fixed overhead cost variance is The fixed overhead volume variance is $2,100 $2,800 1,400 hours 700 units 2 hours per unit Done Requirements 1. Compute the variable overhead cost and efficiency variances and fixed overhead cost and volume variances. 2. Explain why the variances are favorable or unfavorable irect labor hour was sed Print Done because the total fixed overhead cost was because…
Compute the predetermined variable overhead rate and the predetermined fixed overhead rate Stevens door mat. Stevens uses a standard cost system and determines that it should take one hour of direct labor to produce one door mat. The normal production capacity for this mat is 125,000 units per year. The total budgeted overhead at normal capacity is 1,062,500 comprised of 437,500 of variable costs and 625,000 of fixed costs. It applies overhead on the basis of direct labor hours. During the current year, produced 73,100 mats, worked 86,700 direct labor hours, and incurred variable overhead costs of 186,405 and fixed overhead costs of 562,350.
Geovanni Inc. uses standard costs to prepare its flexible budget. Standard and actual costs data for manufacturing overhead for producing 5,000 units of product are as follows: Standard and actual costs data for manufacturing overhead Costs Rate Allocation base per unit Variable overhead $8 per direct labor hour 2 hours Fixed overhead (based on 12,000 hours at 100% capacity) $3 per direct labor hour 2 hours Actual total overhead costs are as follows: Actual Total Overhead Costs Costs Amounts Total variable overhead costs $58,000 Total fixed overhead costs $20,000 Compute the fixed overhead cost variance. Group of answer choices -$7,000 favorable $10,000 unfavorable -$10,000 favorable $18,000 unfavorable
Craftmore Machining reports the following budgeted overhead cost and related data for this year. Activity Budgeted Cost Activity Cost Driver Budgeted Activity Usage Assembly $ 399,750 Direct labor hours (DLH) 13,000 Product design 61,500 Engineering hours (EH) 1,230 Electricity 20,500 Machine hours (MH) 10,000 Setup 51,250 Setups 410 Total $ 533,000 Required:1. Compute a single plantwide overhead rate assuming the company allocates overhead cost based on 13,000 direct labor hours.2. Job 31 used 240 direct labor hours and Job 42 used 520 direct labor hours. Allocate overhead cost to each job using the single plantwide overhead rate from part 1.3. Compute an activity rate for each activity using activity-based costing.4. Allocate overhead costs to Job 31 and Job 42 using activity-based costing. Activity Cost Driver Activity Usage Job 31 Job 42 Direct labor hours (DLH) 240 520 Engineering hours (EH) 27 33 Machine hours (MH) 60 60 Setups 5 7
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Harris Manufacturing produces white sauce. It uses units as the cost driver for overhead. The following information was provided concerning its standard cost system for 2020: Budgeted and Standard Data Actual Data Material 1/4 lb. @ $14 per pound Produced 6,100 units Labor 1.4 hrs. @ $16 per hour Materials purchased 1,600 lbs. for $13.70/pound Total fixed overhead $84,000 Materials used 1,520 lbs. Variable overhead $6.50 per unit Labor worked 8,740 hrs. at $15.90/hour Production 6,000 units Total overhead $122,000 How much is the flexible budget for overhead for 2020? $122,000 $123,000 $127,100 $124,300 $123,650
Patel and Sons Inc. uses a standard cost system to apply factory overhead costs to units produced. Practical capacity for the plant is defined as 51,000 machine hours per year, which represents 25,500 units of output. Annual budgeted fixed factory overhead costs are $255,000 and the budgeted variable factory overhead cost rate is $2.30 per unit. Factory overhead costs are applied on the basis of standard machine hours allowed for units produced. Budgeted and actual output for the year was 18,800 units, which took 40,000 machine hours. Actual fixed factory overhead costs for the year amounted to $249,400 while the actual variable overhead cost per unit was $2.20. Based on the information provided above, prepare the appropriate journal entries to record: (a) actual factory overhead costs for the year, (b) the applied factory overhead costs for the year (both variable and fixed), and (c) the total flexible-budget variance and the production volume variance for the period. Assume that the…

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