Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance-reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor-hours worked in a month: Cost Formulas Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration $15.80g $8,200 + $1.60q $6,400 + $0.80q $1,100 + $0.40q $23,000 + $3.70g $৪,400 $2,100 $11,700 + $1.90q The Production Department planned to work 8,000 labor-hours in March; however, it actually worked 8,400 labor-hours during the month. Its actual costs incurred in March are listed below: Actual Cost Incurred in March Direct labor $ 134,730 $ 19,860 $ 14,570 $ 4,980 $ 54,080 $ 8,700 $ 2,100 $ 26,470 Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Required: 1. Prepare the Production Department's planning budget for the month. 2. Prepare the Production Department's flexible budget for the month. 3. Calculate the spending variances for all expense items.

Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance-reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor-hours worked in a month: Cost Formulas Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration $15.80g $8,200 + $1.60q $6,400 + $0.80q $1,100 + $0.40q $23,000 + $3.70g $৪,400 $2,100 $11,700 + $1.90q The Production Department planned to work 8,000 labor-hours in March; however, it actually worked 8,400 labor-hours during the month. Its actual costs incurred in March are listed below: Actual Cost Incurred in March Direct labor $ 134,730 $ 19,860 $ 14,570 $ 4,980 $ 54,080 $ 8,700 $ 2,100 $ 26,470 Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Required: 1. Prepare the Production Department's planning budget for the month. 2. Prepare the Production Department's flexible budget for the month. 3. Calculate the spending variances for all expense items.

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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Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor-hours worked in a month: Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes. Factory administration The Production Department planned to work 4,200 labor-hours in March; however, it actually worked 4,000 labor-hours during the month. Its actual costs incurred in March are listed below: Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Cost Formulas $16.20g $4,200+ $1.50g $5,700+ $0.60g $1,500+ $0.10g $18,300+ $2.60g $8,600 $2,500 $13,300+ $0.90g Actual Cost Incurred in March $ 66,360 $ 9,680 $ 8,610 $ 2,130 $ 28,700 $ 9,000 $ 2,500 $ 16,310 Required: 1. Prepare the Production…
Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where qis the number of labor-hours worked in a month: Cost Formulas $16.60g $4, 200 + $1.60g $5,300 + $0.70g $1,700 + $0.30g $18,500 $2.90g $8, 300 $2,500 $13,100 + $0.80g Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory adeinistration The Production Department planned to work 4,100 labor-hours in March; however, it actually worked 3,900 labor-hours during the month. Its actual costs incurred in March are listed below: Direct labor Indirect labor Utilities Supplies Equipnent depreciation Factory rent Property taxes Factory administration Actual Cost Incurred in March $ 66,380 $ 9,940 $ 8,560 $ 3,140 $ 29,810 $ 8,700 $2,500 $ 15,610 Required: 1. Prepare the Production…
Use the following information for the Quick Studies below. (Algo) Rafner Manufacturing has the following budgeted data for its two production departments. Budgeted Data Overhead cost Direct labor hours Machine hours $ 1,389,900 QS 17-7 (Algo) Computing departmental overhead rates LO P2 What is the Assembly department overhead rate using direct labor hours? What is the Finishing department overhead rate using machine hours? Assembly 12,300 direct labor hours. 5,700 machine hours The departmental overhead rate for Assembly Budgeted manufacturing costs S Budgeted overhead costs Actual machine hours Answer is complete but not entirely correct. Actual machine hours The departmental overhead rate for Finishing $ 1,389,900 5,700 863,500 $ 15,700 $ 55 244 per direct labor hour per machine hour. $ 863,500 Finishing 19,700 direct labor hours. 15,700 machine hours
Production, Direct Labor, Direct Materials, Sales Budgets, Budgeted Contribution Margin Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven, controller, is responsible for preparing Greiner's master budget and has assembled the following data for the coming year. The direct labor rate includes wages, all employee-related benefits, and the employer's share of FICA. Labor saving machinery will be fully operational by March. Also, as of March 1, the company's union contract calls for an increase in direct labor wages that is included in the direct labor rate. Greiner expects to have 6,600 glare filters in inventory on December 31 of the current year, and has a policy of carrying 35 percent of the following month's projected sales in inventory. Information on the first four months of the coming year is as follows: January February March April Estimated unit sales 37,200 35,400 40,000 40,000 Sales price per unit $80 $80 $75 $75 Direct labor…
Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor-hours worked in a month: Cost Formulas Direct labor $16.20q Indirect labor $4,700 + $1.40q Utilities $5,700 + $0.50q Supplies $1,700 + $0.20q Equipment depreciation $18,600 + $2.50q Factory rent $8,400 Property taxes $2,600 Factory administration $13,100 + $0.70q The Production Department planned to work 4,100 labor-hours in March; however, it actually worked 3,900 labor-hours during the month. Its actual costs incurred in March are listed below: Actual Cost Incurred in March Direct labor $ 64,740 Indirect labor $ 9,620 Utilities $ 8,140 Supplies $ 2,730 Equipment depreciation $ 28,350 Factory rent $ 8,800 Property taxes $ 2,600 Factory…
Use the Information below to answer the two questions that follow. A company provides delivery services and uses two activity measures for its costs: the miles driven and the number of customer order. For the most recent month, the company reported the following information: Actual $ 12,940 $ 22 per mile $ 13 per order Budgeted Fixed cost per month Varlable cost per mile Varlable cost per order $ 26 $ 12 Miles driven Customer orders Budgeted 74 480 Actual 64miles 460 orders Spending Varlance for total costs $203 Unfavorable Q. What was the company's budgeted fixed cost per month? ANS. S Q. What was the company's activity variance for the month? ANS. $ (Click to select) v
Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor-hours worked in a month: Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Cost Formulas $16.30g $4,300 +$1.50q $5,300 + $0.40g $1,400 + $0.30q $18,200+ $2.70q $8,400 $2,600 $13,800 + $0.60q The Production Department planned to work 4,200 labor-hours in March; however, it actually worked 4,000 labor-hours during the month. Its actual costs incurred in March are listed below: Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Required: Actual Cost Incurred in March $ 66,780 $ 9,780 $ 7,370 2,870 $ 29,000 $ 8,800 $ 2,600 $ 15,550 1. Prepare the Production…
Production, Direct Labor, Direct Materials, Sales Budgets, Budgeted Contribution Margin Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven, controller, is responsible for preparing Greiner's master budget and has assembled the following data for the coming year. The direct labor rate includes wages, all employee-related benefits, and the employer's share of FICA. Labor saving machinery will be fully operational by March. Also, as of March 1, the company's union contract calls for an increase in direct labor wages that is included in the direct labor rate. Greiner expects to have 6,600 glare filters in inventory on December 31 of the current year, and has a policy of carrying 35 percent of the following month's projected sales in inventory. Information on the first four months of the coming year is as follows: January February March April Estimated unit sales 37,200 35,400 40,000 40,000 Sales price per unit $80 $80 $75 $75 Direct labor…
Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor-hours worked in a month: Cost Formulas Direct labor $16.50q Indirect labor $4,100 + $1.60q Utilities $5,100 + $0.70q Supplies $1,200 + $0.40q Equipment depreciation $18,000 + $2.50q Factory rent $8,500 Property taxes $3,000 Factory administration $13,500 + $0.80q The Production Department planned to work 4,400 labor-hours in March; however, it actually worked 4,200 labor-hours during the month. Its actual costs incurred in March are listed below: Actual Cost Incurred in March Direct labor $ 70,920 Indirect labor $ 10,320 Utilities $ 8,570 Supplies $ 3,170 Equipment depreciation $ 28,500 Factory rent $ 8,900 Property taxes $ 3,000 Factory…
Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Its Production Department's planning budget and flexible budget are based on the following formulas, where q is the number of labor-hours worked in a month: Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Direct labor Indirect labor Utilities Supplies Equipment depreciation Cost Formulas $16.309 $4,200+ $1.809 $5,800+ $0.909 $1,800+ $0.109 The Production Department planned to work 4,200 labor-hours in March; however, it actually worked 4,000 labor-hours during the month. Its actual costs incurred in March are listed below: Factory rent Property taxes Factory administration $18,600 + $2.609 $8,100 $2,800 $13,300 + $0.709 Actual Cost Incurred in March $ 66,780 $ 10,940 $ 9,970 $ 2,430 $ 29,000 $ 8,500 $ 2,800 $ 15,470 Required: 1. Prepare the Production Department's planning budget for the month.
Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor-hours worked in a month: Direct labor Indirect labor Utilities Supplies Equipment depreciation. Factory rent Property taxes Factory administration Cost Formulas $16.10q $4,600+ $1.70q $5,000+ $0.509 $1,700+ $0.30q $18,700+ $2.80q $8,300 Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration $3,000 $13,400+ $0.60q The Production Department planned to work 4,100 labor-hours in March; however, it actually worked 3,900 labor-hours during the month. Its actual costs incurred in March are listed below: Actual Cost Incurred in March $ 64,330 $ 10,750 $ 7,440 $ 3,140 $ 29,620 $ 8,700 $3,000 $ 15,090 Required: 1. Prepare the Production…
Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Its Production Department's planning budget and flexible budget are based on the following formulas, where q is the number of labor-hours worked in a month: Direct labor Indirect labor Utilities Cost Formulas $16.60q $4,300 +$1.60q $5,700 +$0.40q Supplies $1,200 + $0.20q Equipment depreciation Factory rent $18,600 + $2.80q $8,400 $2,500 Property taxes Factory administration $13,100 +$0.50q The Production Department planned to work 4,500 labor-hours in March; however, it actually worked 4,300 labor-hours during the month. Its actual costs incurred in March are listed below: Actual Cost Incurred in March $ 73,020 Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Required: $ 10,680 $ 7,890 $ 2,310 $ 30,640 $ 8,800 $ 2,500 $ 14,580 1. Prepare the Production Department's planning budget for the month. 2. Prepare the Production…