On May 1, 2017, Bovar Company began the manufacture of a new paging machine known as Dandy. The company in- stalled a standard costing system to account for manufacturing costs. The standard costs for a unit of Dandy follow: Direct materials (3 lb. at S4 per Ib.) Direct manufacturing labor (1/2 hour at $20 per hour) Manufacturing overhead (75% of direct manufacturing labor costs) $12.00 10,00 7.50 $29.50 The following data were obtained from Bovar's records for the month of May: Credit $125,000 55,000 Debit Revenues Accounts payable control (for May's purchases of direct materials) $3,500 2,400 1,890 Direct materials price variance Direct materials efficiency variance Direct manufacturing labor price variance Direct manufacturing labor efficiency variance 2,200 Actual production in May was 4,000 units of Dandy, and actual sales in May were 2,500 units. The amount shown for direct materials price variance applies to materials purchased during May. There was no beginning inventory of materials on May 1, 2017.

On May 1, 2017, Bovar Company began the manufacture of a new paging machine known as Dandy. The company in- stalled a standard costing system to account for manufacturing costs. The standard costs for a unit of Dandy follow: Direct materials (3 lb. at S4 per Ib.) Direct manufacturing labor (1/2 hour at $20 per hour) Manufacturing overhead (75% of direct manufacturing labor costs) $12.00 10,00 7.50 $29.50 The following data were obtained from Bovar's records for the month of May: Credit $125,000 55,000 Debit Revenues Accounts payable control (for May's purchases of direct materials) $3,500 2,400 1,890 Direct materials price variance Direct materials efficiency variance Direct manufacturing labor price variance Direct manufacturing labor efficiency variance 2,200 Actual production in May was 4,000 units of Dandy, and actual sales in May were 2,500 units. The amount shown for direct materials price variance applies to materials purchased during May. There was no beginning inventory of materials on May 1, 2017.

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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