Homework Help is Here – Start Your Trial Now!
Business
Accounting
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. $0.14 per machine-hour $1.90 per machine-hour $16,900+ $38,800 $0.40 per machine-hour $95,000+ $1.10 per machine-hour $67,800 Actual Cost in March. $ 21,640 $ 72,500 $ 8,200 Required: 1. Calculate the activity variances for March. 2. Calculate the spending variances for March. $ 119,000 $ 69,500 During March, the company worked 19,000 machine-hours and produced 13,000 units. The company had originally planned to work 21,000 machine-hours during 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. $0.14 per machine-hour $1.90 per machine-hour $16,900+ $38,800 $0.40 per machine-hour $95,000+ $1.10 per machine-hour $67,800 Actual Cost in March. $ 21,640 $ 72,500 $ 8,200 Required: 1. Calculate the activity variances for March. 2. Calculate the spending variances for March. $ 119,000 $ 69,500 During March, the company worked 19,000 machine-hours and produced 13,000 units. The company had originally planned to work 21,000 machine-hours during March.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Topic Video
Question

Please do not give solution in image format thanku 

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 $0.14 per machine-hour $1.90 per machine-hour $16,900+ $38,800 $0.40 per machine-hour $95,000+ $1.10 per machine-hour $67,800 Actual Cost in March $ 21,640 $ 72,500 $ 8,200 Required: 1. Calculate the activity variances for March. 2. Calculate the spending variances for March. $ 119,000 $ 69,500 During March, the company worked 19,000 machine-hours and produced 13,000 units. The company had originally planned to work 21,000 machine-hours during March.
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: Utilities Maintenance Supplies Indirect labor Depreciation Cost Formula $0.14 per machine-hour $1.90 per machine-hour $16,900+ $38,800 $0.40 per machine-hour $95,000+ $1.10 per machine-hour $67,800 Actual Cost in March $ 21,640 $ 72,500 $ 8,200 Required: 1. Calculate the activity variances for March. 2. Calculate the spending variances for March. $ 119,000 $ 69,500 During March, the company worked 19,000 machine-hours and produced 13,000 units. The company had originally planned to work 21,000 machine-hours during March.
bk ces Required 1 Required 2 Calculate the activity variances for March. (Indicate the effect of each variance by selecting "F" for favorable, "U" unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Utilities Maintenance Supplies Indirect labor Depreciation Total Total Required 1 FAB Corporation Activity Variances For the Month Ended March 31 complete this question by entering your answers in the tabs below. Utilities Maintenance Supplies Indirect labor Depreciation Required 2 <Required 1 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 (1.e., zero variance). Input all amounts as positive values.) FAB Corporation Spending Variances For the Month Ended March 31 Required 2 > Required 1
Transcribed Image Text:bk ces Required 1 Required 2 Calculate the activity variances for March. (Indicate the effect of each variance by selecting "F" for favorable, "U" unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Utilities Maintenance Supplies Indirect labor Depreciation Total Total Required 1 FAB Corporation Activity Variances For the Month Ended March 31 complete this question by entering your answers in the tabs below. Utilities Maintenance Supplies Indirect labor Depreciation Required 2 <Required 1 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 (1.e., zero variance). Input all amounts as positive values.) FAB Corporation Spending Variances For the Month Ended March 31 Required 2 > Required 1
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 4 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Performance measurements
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS