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You have just been hired by FAB Corporation, the manufacturer of a revolutionary new garage door opening device. The president has asked that you review the company's costing system and "do what you can to help us get better control of our manufacturing overhead costs." You find that the company has never used a flexible budget, and you suggest that preparing such a budget would be an excellent first step in overhead planning and control. After much effort and analysis, you determined the following cost formulas and gathered the following actual cost data for March: Utilities Maintenance Supplies Indirect labor Depreciation Cost Formula $16,000+ $0.14 per machine-hour $38,100+ $1.80 per machine-hour $0.60 per machine-hour $94,700+ $2.00 per machine-hour $68,500 Actual Cost in t March $ 20,040 $ 60,700 $ 9,400 $127,600 $ 70,200 During March, the company worked 14,000 machine-hours and produced 8,000 units. The company had originally planned to work 16,000 machine-hours during March. Required: 1. Calculate the activity variances for March. 2. Calculate the spending variances for March.

You have just been hired by FAB Corporation, the manufacturer of a revolutionary new garage door opening device. The president has asked that you review the company's costing system and "do what you can to help us get better control of our manufacturing overhead costs." You find that the company has never used a flexible budget, and you suggest that preparing such a budget would be an excellent first step in overhead planning and control. After much effort and analysis, you determined the following cost formulas and gathered the following actual cost data for March: Utilities Maintenance Supplies Indirect labor Depreciation Cost Formula $16,000+ $0.14 per machine-hour $38,100+ $1.80 per machine-hour $0.60 per machine-hour $94,700+ $2.00 per machine-hour $68,500 Actual Cost in t March $ 20,040 $ 60,700 $ 9,400 $127,600 $ 70,200 During March, the company worked 14,000 machine-hours and produced 8,000 units. The company had originally planned to work 16,000 machine-hours during March. Required: 1. Calculate the activity variances for March. 2. Calculate the spending variances for March.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Required: 1. Calculate the activity variances for March. 2. Calculate the spending variances for March. Complete this question by entering your answers in the tabs below. is during March. Required 1 Required 2 Calculate the activity variances for March. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Utilities Maintenance Supplies Indirect labor Depreciation Total FAB Corporation Activity Variances For the Month Ended March 31 Show Transcribed Text muru Required: 1. Calculate the activity variances for March. 2. Calculate the spending variances for March. Total Utilities Maintenance Supplies Indirect labor Depreciation Required 1 Complete this question by entering your answers in the tabs below. FAB Corporation Spending Variances For the Month Ended March 31 c Required 2 > Required 1 Required Calculate the spending variances for March. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) < Required 1 Tiau originally Required 2 > wompany nad originally p
Transcribed Image Text:Required: 1. Calculate the activity variances for March. 2. Calculate the spending variances for March. Complete this question by entering your answers in the tabs below. is during March. Required 1 Required 2 Calculate the activity variances for March. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Utilities Maintenance Supplies Indirect labor Depreciation Total FAB Corporation Activity Variances For the Month Ended March 31 Show Transcribed Text muru Required: 1. Calculate the activity variances for March. 2. Calculate the spending variances for March. Total Utilities Maintenance Supplies Indirect labor Depreciation Required 1 Complete this question by entering your answers in the tabs below. FAB Corporation Spending Variances For the Month Ended March 31 c Required 2 > Required 1 Required Calculate the spending variances for March. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) < Required 1 Tiau originally Required 2 > wompany nad originally p
You have just been hired by FAB Corporation, the manufacturer of a revolutionary new garage door opening device. The president has asked that you review the company's costing system and "do what you can to help us get better control of our manufacturing overhead costs." You find that the company has never used a flexible budget, and you suggest that preparing such a budget would be an excellent first step in overhead planning and control. After much effort and analysis, you determined the following cost formulas and gathered the following actual cost data for March: Cost Formula Utilities Maintenance. Supplies $16,000+ $0.14 per machine-hour $38,100+ $1.80 per machine-hour $0.60 per machine-hour Indirect labor $94,700+ $2.00 per machine-hour Depreciation $68,500 Required: 1. Calculate the activity variances for March. 2. Calculate the spending variances for March. Actual Cost in March $ 20,040 $ 60,700 $ 9,400 During March, the company worked 14,000 machine-hours and produced 8,000 units. The company had originally planned to work 16,000 machine-hours during March. $127,600 $ 70,200 Complete this question by entering your answers in the tabs below. FAB Corporation Activity Variances Required 1 Required 2 Calculate the activity variances for March. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
Transcribed Image Text:You have just been hired by FAB Corporation, the manufacturer of a revolutionary new garage door opening device. The president has asked that you review the company's costing system and "do what you can to help us get better control of our manufacturing overhead costs." You find that the company has never used a flexible budget, and you suggest that preparing such a budget would be an excellent first step in overhead planning and control. After much effort and analysis, you determined the following cost formulas and gathered the following actual cost data for March: Cost Formula Utilities Maintenance. Supplies $16,000+ $0.14 per machine-hour $38,100+ $1.80 per machine-hour $0.60 per machine-hour Indirect labor $94,700+ $2.00 per machine-hour Depreciation $68,500 Required: 1. Calculate the activity variances for March. 2. Calculate the spending variances for March. Actual Cost in March $ 20,040 $ 60,700 $ 9,400 During March, the company worked 14,000 machine-hours and produced 8,000 units. The company had originally planned to work 16,000 machine-hours during March. $127,600 $ 70,200 Complete this question by entering your answers in the tabs below. FAB Corporation Activity Variances Required 1 Required 2 Calculate the activity variances for March. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
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