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Parker Plastic, Inc., manufactures plastic mats to use with rolling office chairs. Its standard cost information for last year follows: Standard Standard Standard Price (Rate) ft 0.70 per sq. $10.45 per hr. Unit Cost Quantity 12 sq ft. 0.55 hr. Direct materials (plastic) 8.40 Direct labor 5.75 Variable manufacturing overhead (based on direct labor hours) Fixed manufacturing overhead $637,000 980,000 units) 0.95 per hr. 0.55 hr. 0.52 0.65 Parker Plastic had the following actual results for the past year: Number of units produced and sold Number of square feet of plastic used Cost of plastic purchased and used Number of labor hours worked 1,080,000 12,420,000 8,445,600 589,000 5,919,450 618,450 624,000 $ Direct labor cost Variable overhead cost Fixed overhead cost Required: Calculate Parker Plastic's fixed overhead spending and volume variances and its over- or underapplied fixed overhead. (Indicate the effect of each variance by selecting "F" for favorable/Overapplied and "U" for unfavorable/underapplied.) Fixed Overhead Spending Variance Fixed Overhead Volume Variance Over- or Underapplied Fixed Overhead

Parker Plastic, Inc., manufactures plastic mats to use with rolling office chairs. Its standard cost information for last year follows: Standard Standard Standard Price (Rate) ft 0.70 per sq. $10.45 per hr. Unit Cost Quantity 12 sq ft. 0.55 hr. Direct materials (plastic) 8.40 Direct labor 5.75 Variable manufacturing overhead (based on direct labor hours) Fixed manufacturing overhead $637,000 980,000 units) 0.95 per hr. 0.55 hr. 0.52 0.65 Parker Plastic had the following actual results for the past year: Number of units produced and sold Number of square feet of plastic used Cost of plastic purchased and used Number of labor hours worked 1,080,000 12,420,000 8,445,600 589,000 5,919,450 618,450 624,000 $ Direct labor cost Variable overhead cost Fixed overhead cost Required: Calculate Parker Plastic's fixed overhead spending and volume variances and its over- or underapplied fixed overhead. (Indicate the effect of each variance by selecting "F" for favorable/Overapplied and "U" for unfavorable/underapplied.) Fixed Overhead Spending Variance Fixed Overhead Volume Variance Over- or Underapplied Fixed Overhead

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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Parker Plastic, Inc., manufactures plastic mats to use with rolling office chairs. Its standard cost information for last year follows: Standard Standard Standard Price (Rate) ft 0.70 per sq. $10.45 per hr. Unit Cost Quantity 12 sq ft. 0.55 hr. Direct materials (plastic) 8.40 Direct labor 5.75 Variable manufacturing overhead (based on direct labor hours) Fixed manufacturing overhead $637,000 980,000 units) 0.95 per hr. 0.55 hr. 0.52 0.65 Parker Plastic had the following actual results for the past year: Number of units produced and sold Number of square feet of plastic used Cost of plastic purchased and used Number of labor hours worked 1,080,000 12,420,000 8,445,600 589,000 5,919,450 618,450 624,000 $ Direct labor cost Variable overhead cost Fixed overhead cost Required: Calculate Parker Plastic's fixed overhead spending and volume variances and its over- or underapplied fixed overhead. (Indicate the effect of each variance by selecting "F" for favorable/Overapplied and "U" for unfavorable/underapplied.) Fixed Overhead Spending Variance Fixed Overhead Volume Variance Over- or Underapplied Fixed Overhead
Transcribed Image Text:Parker Plastic, Inc., manufactures plastic mats to use with rolling office chairs. Its standard cost information for last year follows: Standard Standard Standard Price (Rate) ft 0.70 per sq. $10.45 per hr. Unit Cost Quantity 12 sq ft. 0.55 hr. Direct materials (plastic) 8.40 Direct labor 5.75 Variable manufacturing overhead (based on direct labor hours) Fixed manufacturing overhead $637,000 980,000 units) 0.95 per hr. 0.55 hr. 0.52 0.65 Parker Plastic had the following actual results for the past year: Number of units produced and sold Number of square feet of plastic used Cost of plastic purchased and used Number of labor hours worked 1,080,000 12,420,000 8,445,600 589,000 5,919,450 618,450 624,000 $ Direct labor cost Variable overhead cost Fixed overhead cost Required: Calculate Parker Plastic's fixed overhead spending and volume variances and its over- or underapplied fixed overhead. (Indicate the effect of each variance by selecting "F" for favorable/Overapplied and "U" for unfavorable/underapplied.) Fixed Overhead Spending Variance Fixed Overhead Volume Variance Over- or Underapplied Fixed Overhead
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