Please need Help with this Managerial Accounting The manager of Jane's Fans needed information regarding the company'soverhead. She felt that there was a problem and asked Jane's accountant to graveher a breakdown of the variable and fixed overhead variances. The companyexperienced the following last period:-The company produced 40,000 fans and incurred the following overhead costs:variable overhead, $98,000; fixed overhead, $76,000.-Overhead rates were based on direct labor hours. The budgeted DL hours were50,000 hours and the budgeted overhead was: variable, $105,000; fixed, $70,000.The standard hours allowed for each unit produced is 1.2 hours.-The amount of actual direct labor hours were 47,000 hours.The variable overhead efficiency variance was:a. $2,100Fb. $700 Uc. $14,700Ud. $2,100Ue. $700 F.

Step 1: Define Overhead Variances:In standard costing, separate budget variances for manufacturing…

Answered: The manager of Jane's Fans needed…

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter9: Evaluating Variances From Standard Costs

Section: Chapter Questions

Problem 17E

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The controller for Muir Companys Salem plant is analyzing overhead in order to determine appropriate drivers for use in flexible budgeting. She decided to concentrate on the past 12 months since that time period was one in which there was little important change in technology, product lines, and so on. Data on overhead costs, number of machine hours, number of setups, and number of purchase orders are in the following table. Required: 1. Calculate an overhead rate based on machine hours using the total overhead cost and total machine hours. (Round the overhead rate to the nearest cent and predicted overhead to the nearest dollar.) Use this rate to predict overhead for each of the 12 months. 2. Run a regression equation using only machine hours as the independent variable. Prepare a flexible budget for overhead for the 12 months using the results of this regression equation. (Round the intercept and x-coefficient to the nearest cent and predicted overhead to the nearest dollar.) Is this flexible budget better than the budget in Requirement 1? Why or why not?
Carlo Lee Corp. has established the following standard cost per unit: Although 10,000 units were budgeted, only 8,800 units were produced. The purchasing department bought 55,000 lb of materials at a cost of $123,750. Actual pounds of materials used were 54,305. Direct labor cost was $186,550 for 18,200 hours worked. Required: Make journal entries to record the materials transactions, assuming that the materials price variance was recorded at the time of purchase. Make journal entries to record the labor variances.
Douglas Davis, controller for Marston, Inc., prepared the following budget for manufacturing costs at two different levels of activity for 20X1: During 20X1, Marston worked a total of 80,000 direct labor hours, used 250,000 machine hours, made 32,000 moves, and performed 120 batch inspections. The following actual costs were incurred: Marston applies overhead using rates based on direct labor hours, machine hours, number of moves, and number of batches. The second level of activity (the right column in the preceding table) is the practical level of activity (the available activity for resources acquired in advance of usage) and is used to compute predetermined overhead pool rates. Required: 1. Prepare a performance report for Marstons manufacturing costs in the current year. 2. Assume that one of the products produced by Marston is budgeted to use 10,000 direct labor hours, 15,000 machine hours, and 500 moves and will be produced in five batches. A total of 10,000 units will be produced during the year. Calculate the budgeted unit manufacturing cost. 3. One of Marstons managers said the following: Budgeting at the activity level makes a lot of sense. It really helps us manage costs better. But the previous budget really needs to provide more detailed information. For example, I know that the moving materials activity involves the use of forklifts and operators, and this information is lost when only the total cost of the activity for various levels of output is reported. We have four forklifts, each capable of providing 10,000 moves per year. We lease these forklifts for five years, at 10,000 per year. Furthermore, for our two shifts, we need up to eight operators if we run all four forklifts. Each operator is paid a salary of 30,000 per year. Also, I know that fuel costs about 0.25 per move. Assuming that these are the only three items, expand the detail of the flexible budget for moving materials to reveal the cost of these three resource items for 20,000 moves and 40,000 moves, respectively. Based on these comments, explain how this additional information can help Marston better manage its costs. (Especially consider how activity-based budgeting may provide useful information for non-value-added activities.)
USD Inc. has established the following standard cost per unit: Although 10,000 units were budgeted, 12,000 units were produced. The Purchasing department bought 50,000 lb of materials at a cost of $237,500. Actual pounds of materials used were 46,000. Direct labor cost was $287,500 for 25,000 hours worked. Required: Make journal entries to record the materials transactions, assuming that the materials price variance was recorded at the time of purchase. Make journal entries to record the labor variances.
What is the standard factory overhead rate?
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Nodalos Company has a maintenance shop where all kinds of trucks repairs are performed. Through the years, various labor standards have been developed to judge performance. However, during a March strike, some labor records vanished. The actual hours of input were 1,000. The direct labor variance was P 1,700, favorable. The standard labor rate was P14 per hour; however, a recent labor shortage had necessitated using higher paid labor workers for some jobs and had produced a labor rate variance for March of P400, unfavorable. 1. What are the standard hours allowed for output achieved? 2. What is the actual labor rate?
Norman is calculating the company's total overhead variance for April. He knows the company paid $14,280 in overhead costs and that the production department produced 3,600 units for a total of 4,800 hours. He also knows that the company has a predetermined overhead rate of $3.00 per labor hour. What else does Norman need to know to complete his calculation? A Overhead fixed costs. B Budgeted overhead costs. C Standard hours allowed. D Overhead variable costs.
ABC Inc. spent a total of $49,760 on factory overhead. Of this, $28,000 was fixed overhead. ABC Inc. had budgeted $27,000 for fixed overhead. Actual machine hours were 5,200. Standard hours for units made were 5,000. The standard variable overhead rate was $4.30. What is the variable overhead rate variance? Enter the amount as positive number. Variable overhead rate variance $fill in the blank 1
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Could you please help me with the correct calculations and answers for the screenshot attached.
Maney Televisions utilizes a traditional overhead allocation method, and has determined that overhead costs are driven by direct labor hours. Relevant cost information is provided below. Total estimated overhead costs $650,000 Total estimated DL hours 130,000 Actual overhead costs $640,300 Actual DL hours 127,500 The unadjusted cost of goods sold balance at the end of the year is $56,000. What is the overhead variance? Please provide your answer as a positive number rounded to the nearest whole dollar.

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