2. Complete the table below that compute the July direct-material and direct-labor variances in the Construction Department and the July direct-labor variances in the Finishing Department. **Springsteen Company Production Process and Cost Analysis**Springsteen Company manufactures guitars using a standard, job-order cost-accounting system across two production departments: Construction and Finishing.**Production Departments:**- **Construction Department:** - Task: Basic guitar built from veneered wood- **Finishing Department:** - Task: Bridge and strings attached; guitar tuned and inspected**Each finished guitar** consists of:- Seven pounds of veneered wood- One pound of wood typically wasted in production- Veneered wood cost: $12 per pound- Additional parts (bridge and strings): $15 per guitar**Labor Standards:**- **Construction Department:** - 6 hours of direct labor at $20 per hour- **Finishing Department:** - 3 hours of direct labor at $15 per hour**July Data Summary:**1. No beginning or ending work-in-process inventories.2. No beginning finished-goods inventory.3. Production: 576 guitars; 376 guitars sold at $400 each.4. Veneered wood purchased: 6,950 pounds at $12.50 per pound.5. Veneered wood used: 5,450 pounds.6. Parts to finish 676 guitars purchased for $10,140.7. Construction Department: - Direct-labor: 3,325 hours; cost: $63,175.8. Finishing Department: - Direct-labor: 1,798 hours; cost: $28,768.9. No direct-material variances in the Finishing Department.**Diagram Explanation:**The diagram illustrates the flow of production from the Construction Department, where the basic guitar is built, to the Finishing Department, where final assemblies and inspections occur. An arrow indicates the transition between departments. **Educational Resource: Direct-Labor Rate and Efficiency Variances Table****Instruction:**Complete the table below to compute the July direct-labor rate and efficiency variances in the Construction Department. **Note:** Indicate the effect of each variance by selecting "Favorable" or "Unfavorable". Select "None" and enter "0" for no effect (i.e., zero variance). Round "Actual Rate" and "Standard Rate" to 2 decimal places.---**Table: Direct-Labor Rate and Efficiency Variances**1. **Actual Labor Cost** - **Columns**: - **Actual Hours**: - Represents the total hours used during the period. - **Actual Rate**: - The wage rate per hour that was actually paid.2. **Projected Labor Cost** - **Columns**: - **Actual Hours**: - Same as above; the actual hours worked. - **Standard Rate**: - The predetermined rate per hour expected to be paid. - **Section**: - **Direct-labor rate variance**: - Identified by the difference between the actual rate paid and the standard rate expected. 3. **Standard Labor Cost** - **Columns**: - **Standard Hours**: - The allowed hours for the actual output. - **Standard Rate**: - Matches with the projected standard rate. - **Section**: - **Direct-labor efficiency variance**: - Represents the difference between the actual hours used and the hours that should have been used according to standard hours.4. **Overall Section** - **Direct-labor variance**: - Calculated from both rate and efficiency variances, highlighting the overall labor cost performance against standards.**Color Coding & Arrows:**- The table is color-coded for clarity, with arrows pointing to sections where variances are calculated. - The background is a soft blue for highlighted sections and a white grid for data entry.**Purpose:** - This table assists in identifying areas where labor costs differed from expected results, helping improve efficiency and cost management in the Construction Department.

Name: 2. Complete the table below that compute the July direct-material and
Uploaded: 2024-03-20T06:32:49.000Z
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Description: 2. Complete the table below that compute the July direct-material and direct-labor variances in the Construction Department and the July direct-labor variances in the Finishing Department. **Springsteen Company Production Process and Cost Analysis**S

Variance analysis : Analysis of differences between planned and actual behavior. After analyzing…

Business

Accounting

Springsteen Company manufactures guitars. The company uses a standard, job-order cost-accounting system in two production departments. In the Construction Department, the wooden guitars are built by highly skilled craftsmen and coated with several layers of lacquer. Then the units are transferred to the Finishing Department, where the bridge of the guitar is attached and the strings are installed. The guitars also are tuned and inspected in the Finishing Department. The diagram below depicts the production process. Construction Department (Basic guitar built from veneered wood.) Finishing Department (Bridge and strings attached; guitar tuned and inspected.) Each finished guitar contains seven pounds of veneered wood. In addition, one pound of wood is typically wasted in the production process. The veneered wood used in the guitars has a standard price of $12 per pound. The other parts needed to complete each guitar, such as the bridge and strings, cost $15 per guitar. The labor standards for Springsteen's two production departments are as follows: Construction Department: 6 hours of direct labor at $20 per hour Finishing Department: 3 hours of direct labor at $15 per hour The following pertains to the month of July. 1. There were no beginning or ending work-in-process inventories in either production department. 2. There was no beginning finished-goods inventory. 3. Actual production was 576 guitars, and 376 guitars were sold on account for $400 each. 4. The company purchased 6,950 pounds of veneered wood at a price of $12.50 per pound. 5. Actual usage of veneered wood was 5,450 pounds of the wood purchased during July. 6. Enough parts (bridges and strings) to finish 676 guitars were purchased at a cost of $10,140. 7. The Construction Department used 3,325 direct-labor hours. The total direct-labor cost in the Construction Department was $63,175. 8. The Finishing Department used 1,798 direct-labor hours. The total direct-labor cost in that department was $28,768. 9. There were no direct-material variances in the Finishing Department.