The following information relates to Modern, Inc.'s overhead costs for the month: Static budget variable overhead $8,000 Static budget fixed overhead Static budget direct labor hours $4,000 1,300 Static budget number of units to be produced 5,000 Modern allocates manufacturing overhead to production based on standard direct labor hours. Last month, Modern reported the following actual results: actual variable overhead $11,000 actual fixed overhead $3,000 actual direct labor hours 1,400 actual number of units produced 7,000 For the month, Modern's fixed manufacturing overhead Volume Variance is O $1, 000 F $1,600 U $1,000 U $2,600 F O $1,600 F

The following information relates to Modern, Inc.'s overhead costs for the month: Static budget variable overhead $8,000 Static budget fixed overhead Static budget direct labor hours $4,000 1,300 Static budget number of units to be produced 5,000 Modern allocates manufacturing overhead to production based on standard direct labor hours. Last month, Modern reported the following actual results: actual variable overhead $11,000 actual fixed overhead $3,000 actual direct labor hours 1,400 actual number of units produced 7,000 For the month, Modern's fixed manufacturing overhead Volume Variance is O $1, 000 F $1,600 U $1,000 U $2,600 F O $1,600 F

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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Anthon Corporation has provided the following information regarding last month's activities. Units produced (actual) 10,920 Master production budget Direct materials. Direct labor $ 240,372 203,952 278,613 Overhead Standard costs per unit Direct materials Direct labor Variable overhead Actual costs Direct materials purchased and used Direct labor Overhead Direct materials Direct labor Variable overhead Fixed overhead $ 3.96 per liter x 5 liters per unit of output $ 33.60 per hour x 0.50 hour per unit $ 29.90 per direct labor-hour Variable overhead is applied on the basis of direct labor-hours. Required: Calculate all variable production cost price and efficiency variances and fixed production cost price and production volume variances. Note: Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option. Price Variance $ 234,780 (60,200 liters) 181,260 (5,300 hours)…
Tat Manufacturing Corporation uses a standard cost system with machine-hours as the activity base for overhead. The following information relates to production for last year. Variable Fixed Total budgeted overhead (at the denominator level of activity) Total applied overhead $ 432,000 $ 684,000 $ 410,400 $ 649,800 $ 456,000 $ 655,500 Total actual overhead The standard machine-hours allowed for the actual output during the year were 7,600. The actual machine-hours incurred were 7,500. 11 What was Taft's variable overhead efficiency variance? A. 2$ 21,600 Favorable B. $ 51,000 Unfavorable 6998 2$ 2$ $ 45,600 Unfavorable С. 5,400 Favorable D. E. None of the above 750 12 Hoover Corporation uses a standard cost system in which it applies manufacturing overhead to units of product on the basis of standard direct labor-hours (DLHS). Hoover's total applied factory overhead was $315,000 last year when the standard DLHS for the actual output were 30,000 hours. The standard variable factory…
Tannin Products Inc. prepared the following factory overhead cost budget for the Trim Department for July of the current year, during which it expected to use 12,000 hours for production: Variable overhead costs: Indirect factory labor $36,000 Power and light 9,120 Indirect materials 19,200 Total variable overhead cost $64,320 Fixed overhead costs: Supervisory salaries $50,160 Depreciation of plant and equipment 13,200 Insurance and property taxes 24,640 Total fixed overhead cost 88,000 Total factory overhead cost $152,320 Tannin has available 16,000 hours of monthly productive capacity in the Trim Department under normal business conditions. During July, the Trim Department actually used 11,000 hours for production. The actual fixed costs were as budgeted. The actual variable overhead for July was as follows: Actual variable factory overhead costs: Indirect factory labor $32,180 Power and light 8,210 Indirect…
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The following data pertains to the month of October for Elm. Co. when production was budgeted to be 5,000 units of P90. P90 has standard costs per unit of: 3 lbs of Direct Materials at a cost of $7.00 per lb; .20 hours of Direct Labor at $18.00 per hour, and variable overhead assigned on the basis of 0.05 machine hours at a rate of $50 per machine hour. Actual production of P90 for October was 4,600 units, using 324 machine hours costing a total of $17,066. A. Determine the variable overhead efficency variance. (negative number indicate a favorable variance)
The following data pertains to the month of October for Elm. Co. when production was budgeted to be 5,000 units of P90. P90 has standard costs per unit of: 3 lbs of Direct Materials at a cost of $7.00 per lb; .20 hours of Direct Labor at $18.00 per hour, and variable overhead assigned on the basis of 0.05 machine hours at a rate of $50 per machine hour. Actual production of P90 for October was 4,600 units, using 15,100 lbs of material costing a total of $107,778. A. Determine the direct materials quantity variance. (negative numbers indicate a favorable variance)
The following data pertains to the month of October for ElmCo. when production was budgeted to be 5,000 units of P90. P90 has standard costs per unit of: 3 Ibs. of Direct Materials at a cost of $7.00 per Ib.; 0.20 hours of Direct Labor at $18.00 per hour; and Variable Overhead assigned on the basis of 0.05 machine hours at a rate of $50 per machine hour. In October the production of P90 totaled 4,600 units, using 324 machine hours costing a total of $17,066. Determine the variable overhead spending variance. (Negative numbers indicate a favorable variance.)
Krump Corporation's cost formula for its manufacturing overhead is $30,600 per month plus $64 per machine-hour. For the month of March, the company planned for activity of 7,900 machine-hours, but the actual level of activity was 7,880 machine- hours. The actual manufacturing overhead for the month was $558,610. The spending variance for manufacturing overhead in March would be closest to: O $22,410 U O $22,410 F O $23,690 F O $23,690 U
Robinwood Fixtures manufactures two products, K4 and X7. The company prepares its master budget on the basis of standard costs. The following data are for September: Standards Direct materials Direct labor Variable overhead (per direct labor- $ 22.60 hour) Fixed overhead (per month) Expected activity (direct labor-hours) Actual resulta Direct material (purchased and used) Direct labor Variable overhead Fixed overhead Units produced (actual) pounds at 0.75 $9.40 per pound hours at 1.25 $27.40 per hour K4 $ 418,080 17,420 pounds at 11,000 $8.80 per pound hours at 14,870 $27.70 per hour $ 359,060 $ 393,740 12,340 units X7 pound at 1 $10.00 per pound 1.50 $24.40 $ 494,970 23,570 hours at $30 per hour pounds at 14,270 $10.30 per pound hours at 22,370 $34.00 per hour $ 471,212 $ 491,960 14,570 units Required: a. Prepare a variance analysis for each variable cost for each product. b. Prepare a fixed overhead variance analysis for each product. Note: For all requirements, Do not round…
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Addison Company budgets production of 2,760 units during the second quarter. Information on its direct labor and its variable and fixed overhead is as follows: Direct labor Variable overhead Fixed overhead 1. Prepare a direct labor budget. 2. Prepare a factory overhead budget. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Each finished unit requires 5 direct labor hours, at a cost of $8 per hour. Budgeted at the rate of $10 per direct labor hour. Budgeted at $550,000 per quarter. Prepare a direct labor budget. Units to produce Direct labor hours needed Cost of direct labor ADDISON COMPANY Direct Labor Budget Second Quarter 2,760 units