Managerial Accounting
17th Edition
ISBN: 9781260247787
Author: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer
Publisher: RENT MCG
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Textbook Question
Chapter 10.B, Problem 1E
EXERCISE 10B-1
Forsyth Company manufactures one product it does not maintain any beginning or ending inventories, and its uses a standard cost system. During die year, the company produced and sold 10,000 units at a price of $135 per unit. Its standard cost per unit produced is S105 and its selling and administrative expenses totaled $235,000. Forsyth does not have any variable
Required:
- When Forsyth closes its standard cost variances, the cost of goods sold will increase (decrease) by how much?
- Using Exhibit 10B-5 as a guide, prepare an income statement for the year.
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Subject: accounting
Mc
Graw
Hill
1
Andretti Company has a single product called a Dak. The company normally produces and sells 86,000 Daks each year at a selling
price of $60 per unit. The company's unit costs at this level of activity are given below:
Q
A
Direct materials
Direct labor
Variable manufacturing overhead
Fixed manufacturing overhead
Variable selling expenses
Fixed selling expenses
Total cost per unit
N
A number of questions relating to the production and sale of Daks follow. Each question is independent.
Required:
1-a. Assume that Andretti Company has sufficient capacity to produce 107,500 Daks each year without any increase in fixed
manufacturing overhead costs. The company could increase its unit sales by 25% above the present 86,000 units each year if it were
willing to increase the fixed selling expenses by $150,000. What is the financial advantage (disadvantage) of investing an additional
$150,000 in fixed selling expenses?
1-b. Would the additional investment be justified?
2. Assume…
Q. No. 2: Martinez Company's relevant range of production is 15,000 units to
25,000 units. When it produces and sells 17,500 units, its average costs per unit are
as follows:
Average Cost per
Unit ($)
Selling Price
Direct materials
Direct labor.
Variable manufacturing overhead
Fixed manufacturing overhead.
Fixed selling expense
Fixed administrative expense
Sales commissions
Variable administrative expense
50
10
6.
5.
3
2
2.5
Required:
a. For financial accounting purposes, what is the total amount of product costs
incurred to make 17,500 units?
b. If 18,500 units are produced and sold, calculate the variable cost per unit and
total for units produced and sold?
c. If 19,000 units are produced, what is the average fixed manufacturing cost
per unit produced?
d. if 19,500 units are produced, what is the total amount of manufacturing
overhead cost incurred to support this level of production? What is this total
amount expressed on a per unit basis?
Chapter 10 Solutions
Managerial Accounting
Ch. 10.A - EXERCISE 10A-1 Fixed Overhead Variances LO10-4...Ch. 10.A - EXERCISE 10A-2 Predetermined Overhead Rate;...Ch. 10.A - Prob. 3ECh. 10.A - EXERCISE 10A-4 Fixed Overhead Variances LO10-4...Ch. 10.A - EXERCISE 10A5 Using Fixed Overhead Variances LO104...Ch. 10.A - EXERCISE 10A-6 Predetermined Overhead Rate LO10-4...Ch. 10.A - EXERCISE 10A-7 Relations Among Fixed Overhead...Ch. 10.A - Prob. 8PCh. 10.A - PROBLEM 10A-9 Applying Overhead; Overhead...Ch. 10.A - PROBLEM 10A-10 Comprehensive Standard Cost...
Ch. 10.A -
PROBLEM 10A-11 Comprehensive Standard Cost...Ch. 10.A - Prob. 12PCh. 10.B - EXERCISE 10B-1 Standard Cost Flows; Income...Ch. 10.B - Prob. 2ECh. 10.B - Prob. 3ECh. 10.B - Prob. 4ECh. 10.B - Prob. 5PCh. 10.B - Prob. 6PCh. 10 - Prob. 1QCh. 10 - Why are separate price and quantity variances...Ch. 10 - 10-3 Who is generally responsible for the...Ch. 10 - The materials price variance can be computed at...Ch. 10 - 10-5 If the materials price variance is favorable...Ch. 10 - Prob. 6QCh. 10 - Prob. 7QCh. 10 - 10-8 What effect, if any, would you expect...Ch. 10 - 10-9 If variable manufacturing overhead is applied...Ch. 10 - 10-10 Why can undue emphasis on labor efficiency...Ch. 10 -
The Excel worksheet form that appears below is to...Ch. 10 - Prob. 2AECh. 10 - Prob. 1F15Ch. 10 - Prob. 2F15Ch. 10 - Prob. 3F15Ch. 10 - Prob. 4F15Ch. 10 - Prob. 5F15Ch. 10 - Prob. 6F15Ch. 10 - Prob. 7F15Ch. 10 - Prob. 8F15Ch. 10 - Prob. 9F15Ch. 10 - Preble Company manufactures one product. Its...Ch. 10 - Prob. 11F15Ch. 10 - Prob. 12F15Ch. 10 - Prob. 13F15Ch. 10 - Prob. 14F15Ch. 10 - Prob. 15F15Ch. 10 - EXERCISE 10-1 Direct Materials Variances LO10-1...Ch. 10 -
EXERCISE 10-2 Direct Labor Variances...Ch. 10 -
EXERCISE 10–3 Variable Overhead Variances...Ch. 10 - EXERCISE 10-4 Direct Labor and Variable...Ch. 10 -
EXERCISE 10-5 Working Backwards from Labor...Ch. 10 - EXERCISE 10-6 Direct Materials and Direct Labor...Ch. 10 - EXERCISE 10-7 Direct Materials Variances LOIO-1...Ch. 10 -
EXERCISE 10-8 Direct Materials and Direct Labor...Ch. 10 -
PROBLEM 10-9 Comprehensive Variance Analysis...Ch. 10 -
PROBLEM 10-10 Multiple Products, Materials, and...Ch. 10 - PROBLEM 10-11 Direct Materials and Direct Labor...Ch. 10 - PROBLEM 10-12 Variance Analysis in a...Ch. 10 - Prob. 13PCh. 10 - Prob. 14PCh. 10 - PROBLEM 10-15 Comprehensive Variance Analysis...Ch. 10 - Prob. 16PCh. 10 - Prob. 17C
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