xercise 6-55 (Algo) Operations Costing (LO 6-4) Witt Recreation Company (WRC) makes e-bikes. The company currently manufactures two models, the C the WRC factories. Both models require the same assembling operations. The difference between the materials. The following data are available for the second quarter. Number of bikes assembled Materials cost per bike Other costs: Direct labor Depreciation and lease. Supervision and control Factory administration Coaster 750 Traveler 450 $ 638 $ 1,214 Total 1,200 $ 313,800 396,800 261,800 354,800 Required: "Witt Recreation Company uses operations costing and assigns conversion costs based on the number of
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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