Sole Purpose Shoe Company is owned and operated by Sarah Charles. The company manufactures casual shoes, with manufacturing facilities in your state. Sarah began the business this year, and while she has a great deal of experience in manufacturing popular and comfortable shoes, she needs some help in evaluating her results for the year, and asks for your help. Under normal conditions, Sarah spends $8.40 per unit of materials, and it will take 3.6 units of material per pair of shoes. During July, Sole Purpose Shoe Company incurred actual direct materials costs of $60,632 for 6,890 units of direct materials in the production of 2, 175 pairs of shoes. Under normal conditions, Sarah pays her employees $8.50 per hour, and it will take 2.8 hours of labor per pair of shoes. During August, Sole Purpose Shoe Company incurred actual direct labor costs of $65,610 for 7,290 hours of direct labor in the production of 2,300 pairs of shoes. Sarah has learned a lot from you over the past two months, and has compiled the following data for Sole Purpose Shoe Company for September using the techniques you taught her. She would like your help in preparing a Budget Performance Report for September. The company produced 3,000 pairs of shoes that required 10,500 units of material purchased at $8.20 per unit and 8, 100 hours of labor at an hourly rate of $8.90 per hour during the month. Actual factory overhead during September was $23, 400. When entering variances, use a negative number for a favorable cost variance, and a positive number for an unfavorable cost variance.
Sole Purpose Shoe Company is owned and operated by Sarah Charles. The company manufactures casual shoes, with manufacturing facilities in your state. Sarah began the business this year, and while she has a great deal of experience in manufacturing popular and comfortable shoes, she needs some help in evaluating her results for the year, and asks for your help. Under normal conditions, Sarah spends $8.40 per unit of materials, and it will take 3.6 units of material per pair of shoes. During July, Sole Purpose Shoe Company incurred actual direct materials costs of $60,632 for 6,890 units of direct materials in the production of 2, 175 pairs of shoes. Under normal conditions, Sarah pays her employees $8.50 per hour, and it will take 2.8 hours of labor per pair of shoes. During August, Sole Purpose Shoe Company incurred actual direct labor costs of $65,610 for 7,290 hours of direct labor in the production of 2,300 pairs of shoes. Sarah has learned a lot from you over the past two months, and has compiled the following data for Sole Purpose Shoe Company for September using the techniques you taught her. She would like your help in preparing a Budget Performance Report for September. The company produced 3,000 pairs of shoes that required 10,500 units of material purchased at $8.20 per unit and 8, 100 hours of labor at an hourly rate of $8.90 per hour during the month. Actual factory overhead during September was $23, 400. When entering variances, use a negative number for a favorable cost variance, and a positive number for an unfavorable cost variance.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Sole Purpose Shoe Company is owned and operated by Sarah Charles. The company manufactures casual shoes, with
manufacturing facilities in your state. Sarah began the business this year, and while she has a great deal of experience in
manufacturing popular and comfortable shoes, she needs some help in evaluating her results for the year, and asks for
your help.
Under normal conditions, Sarah spends $8.40 per unit of materials, and it will take 3.6 units of material per pair of shoes.
During July, Sole Purpose Shoe Company incurred actual direct materials costs of $60,632 for 6,890 units of direct
materials in the production of 2, 175 pairs of shoes.
Under normal conditions, Sarah pays her employees $8.50 per hour, and it will take 2.8 hours of labor per pair of shoes.
During August, Sole Purpose Shoe Company incurred actual direct labor costs of $65,610 for 7,290 hours of direct labor
in the production of 2,300 pairs of shoes.
Sarah has learned a lot from you over the past two months, and has compiled the following data for Sole Purpose Shoe
Company for September using the techniques you taught her. She would like your help in preparing a Budget
Performance Report for September. The company produced 3,000 pairs of shoes that required 10,500 units of material
purchased at $8.20 per unit and 8, 100 hours of labor at an hourly rate of $8.90 per hour during the month. Actual factory
overhead during September was $23, 400. When entering variances, use a negative number for a favorable cost
variance, and a positive number for an unfavorable cost variance.
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