Parker Plastic, Incorporated, manufactures plastic mats to use with rolling office chairs. Its standard cost information for last yearfollows:Direct materials (plastic)Direct laborVariable manufacturing overhead (based on direct labor hours)Fixed manufacturing overhead ($461,000 +922,000 units)Parker Plastic had the following actual results for the past year:Number of units produced and soldNumber of square feet of plastic usedCost of plastic purchased and usedNumber of labor hours workedDirect labor costSVariable overhead costFixed overhead cost1,160,00012,000,000$ 16,800,000320,000$ 3,744,000$ 1,100,000$377,000Standard Quantity12 square foot0.3 hourStandard Price (Rate)$ 1.45 per square foot$ 11.90 per hourStandard UnitCost$ 17.403.570.3 hour$ 2.30per hour0.690.50Required:Calculate Parker Plastic's direct materials price and quantity variances.Note: Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, "U" forunfavorable, and "None" for no effect (i.e., zero variance).Direct Material Price VarianceDirect Material Quantity Variance

Direct Material Price Variance – It is the cost or price difference between actual price paid for…

Answered: Parker Plastic, Incorporated,…

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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Cool Sky reports the following costing data on its product for its first year of operations. During this first year, the company produced 44,000 units and sold 36,000 units at a price of $150 per unit. Manufacturing costs Direct materials per unit $ 66 Direct labor per unit $ 25 Variable overhead per unit $ 9 Fixed overhead for the year $ 572,000 Selling and administrative costs Variable selling and administrative cost per unit $ 12 Fixed selling and administrative cost per year $ 110,000 2a. Assume the company uses variable costing. Determine its product cost per unit.
Dozier Company produced and sold 1,000 units during its first month of operations. It reported the following costs and expenses for the month: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Tolal manufacturing overhead Variable selling expense Fixed selling expense Total selling expense Variable administrative expense Fixed administrative expense Total administrative expense $ 18,200 30,400 $ 13.600 21,200 $ 4,800 26,600 b. What is the total Indirect manufacturing cost? 3. With respect to cost classifications for manufacturers: a. What is the total manufacturing cost? b. What is the total nonmanufacturing cost? c. What are the total conversion cost and prime cost? Required 1 Required: 1. With respect to cost classifications for preparing financial statements: a. What is the total product cost? b. What is the total perlod cost? Complete this question by entering your answers in the tabs below. 2. With respect to cost classifications for…
The following information was collected for the first year of manufacturing for Appliance Apps: Direct Materials per Unit $2.50 Direct Labor per Unit $1.50 Variable Manufacturing Overhead per Unit $0.25 Variable Selling and Administration Expenses $1.75 Units Produced 39,000 Units Sold 35,000 Sales Price $12 Fixed Manufacturing Expenses $117,000 Fixed Selling and Administration Expenses $20,000 Question Content Area Prepare an income statement under variable costing method. Appliance AppsIncome Statement $- Select - - Select - $- Select - - Select - $- Select - - Select - - Select - $- Select - Question Content Area Prepare a reconciliation to the income under the absorption method. Appliance AppsReconciliation $- Select - - Select - $- Select -
Parker Plastic, Inc., manufactures plastic mats to use with rolling office chairs. Its standard cost information for last year follows: Standard Quantity 12 sq ft. 0.3 hr. Standard Price (Rate) $ 0.65 per sq. ft. $10.20 per hr. 0.3 hr. $ 0.70 per hr. Direct materials (plastic) Direct labor Variable manufacturing overhead (based on direct labor hours) Fixed manufacturing overhead ($352,000 880,000 units) 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 Direct labor cost Variable overhead cost Fixed overhead cost 980,000 11,270,000 $ 7,100,100 289,000 Fixed Overhead Spending Variance Fixed Overhead Volume Variance Over- or Underapplied Fixed Overhead $ 2,832,200 $ $ 231,200 334,000 Standard Unit Cost $7.80 3.06 0.21 0.40 Required: Calculate Parker Plastic's fixed overhead spending and volume variances and its over- or underapplied fixed…
Your Company uses a total of 13,000 units of a part that are produced and used every year. The company's Accounting Department reports the following costs of producing the part at this level of activity: Per Unit Direct materials. $2.90 Direct labor... $7.50 Variable manufacturing overhead... $8.00 Supervisor's salary. $3.40 Depreciation of special equipment.. $1.80 Other fixed costs... $7.00 An outside supplier has offered to make the part and sell it to the company for $29.80 each. If this offer is accepted, the supervisor's salary and all of the variable costs can be avoided. If the part were purchased instead of produced, $2 of the other overhead could be avoided. In addition, the space used to make the part could be used to make more of one of the company's other products, generating an additional segment margin of $25,000 per year for that product. What would be the impact on the company's overall net operating income of buying the part? O A. Decrease by $79,000 per year. O B.…
MTI makes three types of lawn tractors: M3100, M4100, and M6100. In the past, it allocated overhead to products using machine-hours. Last year, the company produced 10,000 units of M3100, 17,500 units of M4100, and 10,000 units of M6100 and had the following revenues and costs: MTI Income Statement M3100 M4 100 M6100 Total Sales revenue. Direct costs Direct materials .. Direct labor $9,000,000 $15,000,000 $13,500,000 $37,500,000 3,000,000 600,000 4,500,000 900,000 3,300,000 10,800,000 1,800,000 3,300,000 Variable overhead Setting up machines. Processing sales orders... Warehousing ..... Operating machines Shipping .. Contribution margin. Plant administration 2,400,000 1,800,000 2,400,000 1,200,000 900,000 $14,700,000 Gross profit..... 6,000,000 $ 8,700,000 MTI's controller has heard about activity-based costing and puts together an employee team to recommend cost allocation bases. The employee team recommends the following: Activity Cost Driver M3100 M4100 M6100 Setting up machines....…
[The following information applies to the questions displayed below.] Cool Sky reports the following costing data on its product for its first year of operations. During this first year, the company produced 44,000 units and sold 36,000 units at a price of $140 per unit. Manufacturing costs Direct materials per unit Direct labor per unit Variable overhead per unit Fixed overhead for the year Selling and administrative costs Variable selling and administrative cost per unit Fixed selling and administrative cost per year 2$ $4 $4 $ 528,000 60 22 8 11 $ 105,000 1a. Assume the company uses absorption costing. Determine its product cost per unit. Absorption costing Per unit product cost using: Direct materials per unit Direct labor per unit
Aces Incorporated, a manufacturer of tennis rackets, began operations this year. The company produced 5,600 rackets and sold 4,500. Each racket was sold at a price of $86. Fixed overhead costs are $70,560 for the year, and fixed selling and administrative costs are $64,800 for the year. The company also reports the following per unit variable costs for the year: Direct materials Direct labor Variable overhead Variable selling and administrative expenses Required: Prepare an income statement under absorption costing. ACES INCORPORATED Income Statement (Absorption Costing) Sales Cost of goods sold Gross profit Selling and administrative expenses Income $ $ 387,000 387,000 $ 387,000 $ 11.88 7.88 4.84 1.60
Rip Tide Company manufactures surfboards. Its standard cost information follows: Direct materials (fiberglass) Direct labor Variable manufacturing overhead (based on direct labor hours) Fixed manufacturing overhead ($27,000 ÷ 250 units) Rip Tide has the following actual results for the month of June: Number of units produced and sold Number of square feet of fiberglass purchased and used Cost of fiberglass used Number of labor hours worked Direct labor cost Variable overhead cost Fixed overhead cost View transaction list Journal entry worksheet A Required: 1 & 2. Prepare the journal entries to record the direct materials, direct labor costs and related variances for Rip Tide. Note: If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Do not round intermediate calculations and round your final answers to nearest dollar amount. B Standard Quantity 13.5 square feet 9.8 hours 9.8 hours Record the entry for direct materials costs…
JART manufactures and sells underwater markers. Its contribution margin income statement follows. Contribution Margin Income Statement For Year Ended December 31 Per Unit Annual Total Sales (420,000 units) $ 7.00 $ 2,940,000 Variable costs Direct materials 1.46 613,200 Direct labor 0.44 184,800 Variable overhead 0.70 294,000 Contribution margin 4.40 1,848,000 Fixed costs Fixed overhead 0.30 126,000 Fixed general and administrative 0.25 105,000 Income $ 3.85 $ 1,617,000 A potential customer offers to buy 52,000 units for $3.70 each. These sales would not affect the company’s sales through its normal channels. Details about the special offer follow. Direct materials cost per unit and variable overhead cost per unit would not change. Direct labor cost per unit would be $0.62 because the offer would require overtime pay. Accepting the offer would require incremental fixed general and administrative costs of $5,200. Accepting the offer would require no…
Hartley Uniforms produces uniforms. The company allocates manufacturing overhead based on the machine hours each job uses. Hartley Uniforms reports the following cost data for the past year: Budget Actual 7,600 hours 6,100 hours Direct labor hours Machine hours 7,200 hours 6,300 hours Depreciation on salespeople's autos $23,000 $23,000 Indirect materials $48,500 $50,500 Depreciation on trucks used to deliver uniforms to customers solla $13,000 $70,000 $40,000 $11,000 Depreciation on plant and equipment Indirect manufacturing labor $72,500 $42,000 Customer service hotline $19,000 $21,000 Plant utilities $35,900 $38,400 Direct labor cost $72,500 $85,500 Requirements 1odel tba 1. Compute the predetermined manufacturing overhead rate. 2. Calculate the allocated manufacturing overhead for the past year. 3. Compute the underallocated or overallocated manufacturing overhead. How will this underallocated or overallocated manufacturing overhead be disposed of? 4. How can managers usA acco
The following Informetlon relates to a company with a relevant range of activity from 10,000 units to 15,000 unlts. They are currently producing and selling 12,000 units. The average cost per unit is $7.40 for direct materlals; $4.00 for direct labor, and $4.00 for varlable manufacturing overhead. The average fixed cost per unit is $14.20 for fixed manufacturing overhead; $2.70 for fixed selling expenses and $1.80 for fixed administrative expenses. Variable selling expenses are $.60 per unit and varlable administrative expenses are $.50 per unit. Required: (For questlons a. - d. assume that 14,000 units are produced and sold.) a. Calculate the total amount of varlable cost for the units sold. b. Calculate the varlable cost per unit sold. (Round "Per unit" answer to 2 decimal places.) c. Calculate the total amount of fixed manufacturing costs. d. Calculate the average fixed manufacturing cost per unit produced. (Round "Per unit" answer to 2 decimal places.) e. Calculate the Incremental…

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