Quality Fender, which uses a standard cost system, manufactured 20,000 boat fenders during 2024. The 2024 revenue and cost information for Quality follows: 1(Click the icon to view the revenue and cost information.) Assume each fender produced was sold for the standard price of $40, and total selling and administrative costs were $350,000. Prepare a standard cost income statement for 2024 for Quality Fender. (Use a minus sign or parentheses to enter any contra expenses. Enter all other amounts as positive numbers.) Quality Fender Standard Cost Income Statement For the Year Ended December 31, 2024 (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) Gross Profit (14) Operating Income (Loss) 1: Data Table Sales Revenue $800,000 Cost of Goods Sold (at standard) 191,240 Direct materials cost variance 7,250 F Direct materials efficiency variance 5,450 U Direct labor cost variance 430 U Direct labor efficiency variance 550 F Variable overhead cost variance 610 U Variable overhead efficiency variance 380 F Fixed overhead cost variance 2,750 U Fixed overhead volume variance 4,160 U

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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Question

Quality

Fender, which uses a standard cost system, manufactured

20,000

boat fenders during

2024.

The

2024

revenue and cost information for

Quality

follows:

1(Click

the icon to view the revenue and cost information.)

Assume each fender produced was sold for the standard price of

$40,

and total selling and administrative costs were

$350,000.

Prepare a standard cost income statement for

2024

for

Quality

Fender. (Use a minus sign or parentheses to enter any contra expenses. Enter all other amounts as positive numbers.)

Quality Fender
Standard Cost Income Statement
For the Year Ended December 31, 2024
(1)
(2)
(3)
	(4)
	(5)
	(6)
	(7)
	(8)
	(9)
	(10)
	(11)
	(12)
(13)
Gross Profit
(14)
Operating Income (Loss)

1: Data Table

Sales Revenue	$800,000
Cost of Goods Sold (at standard)	191,240
Direct materials cost variance	7,250 F
Direct materials efficiency variance	5,450 U
Direct labor cost variance	430 U
Direct labor efficiency variance	550 F
Variable overhead cost variance	610 U
Variable overhead efficiency variance	380 F
Fixed overhead cost variance	2,750 U
Fixed overhead volume variance	4,160 U

(1)

Cost of Goods Sold at actual

Cost of Goods Sold at standard

Direct Labor Cost Variance

Direct Labor Efficiency Variance

Direct Materials Cost Variance

Direct Materials Efficiency Variance

Fixed Overhead Cost Variance

Fixed Overhead Volume Variance

Manufacturing Cost Variances:

Sales Revenue

Selling and Administrative Expenses

Total Manufacturing Cost Variances

Variable Overhead Cost Variance

Variable Overhead Efficiency Variance

(2)

Cost of Goods Sold at actual

Cost of Goods Sold at standard

Direct Labor Cost Variance

Direct Labor Efficiency Variance

Direct Materials Cost Variance

Direct Materials Efficiency Variance

Fixed Overhead Cost Variance

Fixed Overhead Volume Variance

Manufacturing Cost Variances:

Sales Revenue

Selling and Administrative Expenses

Total Manufacturing Cost Variances

Variable Overhead Cost Variance

Variable Overhead Efficiency Variance

(4)

Cost of Goods Sold at actual

Cost of Goods Sold at standard

Direct Labor Cost Variance

Direct Labor Efficiency Variance

Direct Materials Cost Variance

Direct Materials Efficiency Variance

Fixed Overhead Cost Variance

Fixed Overhead Volume Variance

Manufacturing Cost Variances:

Sales Revenue

Selling and Administrative Expenses

Total Manufacturing Cost Variances

Variable Overhead Cost Variance

Variable Overhead Efficiency Variance

(5)

Cost of Goods Sold at actual

Cost of Goods Sold at standard

Direct Labor Cost Variance

Direct Labor Efficiency Variance

Direct Materials Cost Variance

Direct Materials Efficiency Variance

Fixed Overhead Cost Variance

Fixed Overhead Volume Variance

Manufacturing Cost Variances:

Sales Revenue

Selling and Administrative Expenses

Total Manufacturing Cost Variances

Variable Overhead Cost Variance

Variable Overhead Efficiency Variance

(6)

Cost of Goods Sold at actual

Cost of Goods Sold at standard

Direct Labor Cost Variance

Direct Labor Efficiency Variance

Direct Materials Cost Variance

Direct Materials Efficiency Variance

Fixed Overhead Cost Variance

Fixed Overhead Volume Variance

Manufacturing Cost Variances:

Sales Revenue

Selling and Administrative Expenses

Total Manufacturing Cost Variances

Variable Overhead Cost Variance

Variable Overhead Efficiency Variance

(7)

Cost of Goods Sold at actual

Cost of Goods Sold at standard

Direct Labor Cost Variance

Direct Labor Efficiency Variance

Direct Materials Cost Variance

Direct Materials Efficiency Variance

Fixed Overhead Cost Variance

Fixed Overhead Volume Variance

Manufacturing Cost Variances:

Sales Revenue

Selling and Administrative Expenses

Total Manufacturing Cost Variances

Variable Overhead Cost Variance

Variable Overhead Efficiency Variance

(8)

Cost of Goods Sold at actual

Cost of Goods Sold at standard

Direct Labor Cost Variance

Direct Labor Efficiency Variance

Direct Materials Cost Variance

Direct Materials Efficiency Variance

Fixed Overhead Cost Variance

Fixed Overhead Volume Variance

Manufacturing Cost Variances:

Sales Revenue

Selling and Administrative Expenses

Total Manufacturing Cost Variances

Variable Overhead Cost Variance

Variable Overhead Efficiency Variance

(9)

Cost of Goods Sold at actual

Cost of Goods Sold at standard

Direct Labor Cost Variance

Direct Labor Efficiency Variance

Direct Materials Cost Variance

Direct Materials Efficiency Variance

Fixed Overhead Cost Variance

Fixed Overhead Volume Variance

Manufacturing Cost Variances:

Sales Revenue

Selling and Administrative Expenses

Total Manufacturing Cost Variances

Variable Overhead Cost Variance

Variable Overhead Efficiency Variance

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

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