The standard costs refer to the estimated cost per unit. The standard cost plays a very important role because a comparison of standard costs and actual cost help in measuring the performance. The budgets and standard costs are an important part of management planning and controlling costs. To calculate: The material price variance, material quantity variance, total material variance, direct labor price variance, direct labor quantity variance, and total direct labor variances.

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Answer 1

Question

Chapter 26, Problem 2PSA

a

To determine

Introduction: The standard costs refer to the estimated cost per unit. The standard cost plays a very important role because a comparison of standard costs and actual cost help in measuring the performance. The budgets and standard costs are an important part of management planning and controlling costs.

To calculate: The material price variance, material quantity variance, total material variance, direct labor price variance, direct labor quantity variance, and total direct labor variances.

b.

To determine

Introduction: The overhead variance is related to underspending and overspending and it normally includes that cost per indirect labor hour incurred is different than the budgeted. The total overheads variance requires actual manufacturing overheads and applied manufacturing overheads.

To calculate: The total overhead variance.

c.

To determine

Introduction: Under variance analysis, the standard cost accounting system is used to prepare the income statement. In the standard costing the cost of goods sold is taken according to the standard cost and then the adjustment for favorable and unfavorable variance is made.

To prepare: The income statement.

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The cost accountant for Kenner Beverage Co. estimated that total factory overhead cost for the Blending Department for the coming fiscal year beginning May 1 would be $765,700, and total direct labor costs would be $589,000. During May, the actual direct labor cost totaled $51,000, and factory overhead cost incurred totaled $68,950. A)What is the predetermined factory overhead rate based on direct labor cost? Enter your answer as a whole percent not in decimals. b) Journalize the entry to apply factory overhead to production for May. Work in Process-Blending Department Factory Overhead-Blending Department C) What is the May 31 balance of the account Factory Overhead—Blending Department? Amount:

Winston Company estimates that total factory overhead for the following year will be $1,050,300. The company has decided that the basis for applying factory overhead should be machine hours, which are estimated to be 38,900 hours. The total machine hours for the year were 54,200. The actual factory overhead for the year was $1,455,000. a. Determine the total factory overhead applied. Round to the nearest dollar. b. Compute the over- or underapplied factory overhead for the year. c. Journalize the entry to transfer the over- or underapplied factory overhead to Cost of Goods Sold. If an amount box does not require an entry, leave it blank.

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Answer 2

Question

Chapter 26, Problem 2PSA

a

To determine

Introduction: The standard costs refer to the estimated cost per unit. The standard cost plays a very important role because a comparison of standard costs and actual cost help in measuring the performance. The budgets and standard costs are an important part of management planning and controlling costs.

To calculate: The material price variance, material quantity variance, total material variance, direct labor price variance, direct labor quantity variance, and total direct labor variances.

b.

To determine

Introduction: The overhead variance is related to underspending and overspending and it normally includes that cost per indirect labor hour incurred is different than the budgeted. The total overheads variance requires actual manufacturing overheads and applied manufacturing overheads.

To calculate: The total overhead variance.

c.

To determine

Introduction: Under variance analysis, the standard cost accounting system is used to prepare the income statement. In the standard costing the cost of goods sold is taken according to the standard cost and then the adjustment for favorable and unfavorable variance is made.

To prepare: The income statement.

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Answer 3

Question

Chapter 26, Problem 2PSA

a

To determine

Introduction: The standard costs refer to the estimated cost per unit. The standard cost plays a very important role because a comparison of standard costs and actual cost help in measuring the performance. The budgets and standard costs are an important part of management planning and controlling costs.

To calculate: The material price variance, material quantity variance, total material variance, direct labor price variance, direct labor quantity variance, and total direct labor variances.

b.

To determine

Introduction: The overhead variance is related to underspending and overspending and it normally includes that cost per indirect labor hour incurred is different than the budgeted. The total overheads variance requires actual manufacturing overheads and applied manufacturing overheads.

To calculate: The total overhead variance.

c.

To determine

Introduction: Under variance analysis, the standard cost accounting system is used to prepare the income statement. In the standard costing the cost of goods sold is taken according to the standard cost and then the adjustment for favorable and unfavorable variance is made.

To prepare: The income statement.

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Answer 4

Question

Chapter 26, Problem 2PSA

a

To determine

Introduction: The standard costs refer to the estimated cost per unit. The standard cost plays a very important role because a comparison of standard costs and actual cost help in measuring the performance. The budgets and standard costs are an important part of management planning and controlling costs.

To calculate: The material price variance, material quantity variance, total material variance, direct labor price variance, direct labor quantity variance, and total direct labor variances.

b.

To determine

Introduction: The overhead variance is related to underspending and overspending and it normally includes that cost per indirect labor hour incurred is different than the budgeted. The total overheads variance requires actual manufacturing overheads and applied manufacturing overheads.

To calculate: The total overhead variance.

c.

To determine

Introduction: Under variance analysis, the standard cost accounting system is used to prepare the income statement. In the standard costing the cost of goods sold is taken according to the standard cost and then the adjustment for favorable and unfavorable variance is made.

To prepare: The income statement.

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Answer 5

Chapter 26, Problem 2PSA

a

To determine

Introduction: The standard costs refer to the estimated cost per unit. The standard cost plays a very important role because a comparison of standard costs and actual cost help in measuring the performance. The budgets and standard costs are an important part of management planning and controlling costs.

To calculate: The material price variance, material quantity variance, total material variance, direct labor price variance, direct labor quantity variance, and total direct labor variances.

b.

To determine

Introduction: The overhead variance is related to underspending and overspending and it normally includes that cost per indirect labor hour incurred is different than the budgeted. The total overheads variance requires actual manufacturing overheads and applied manufacturing overheads.

To calculate: The total overhead variance.

c.

To determine

Introduction: Under variance analysis, the standard cost accounting system is used to prepare the income statement. In the standard costing the cost of goods sold is taken according to the standard cost and then the adjustment for favorable and unfavorable variance is made.

To prepare: The income statement.

Answer 6

Chapter 26, Problem 2PSA

a

To determine

Introduction: The standard costs refer to the estimated cost per unit. The standard cost plays a very important role because a comparison of standard costs and actual cost help in measuring the performance. The budgets and standard costs are an important part of management planning and controlling costs.

To calculate: The material price variance, material quantity variance, total material variance, direct labor price variance, direct labor quantity variance, and total direct labor variances.

Answer 7

Chapter 26, Problem 2PSA

a

To determine

Introduction: The standard costs refer to the estimated cost per unit. The standard cost plays a very important role because a comparison of standard costs and actual cost help in measuring the performance. The budgets and standard costs are an important part of management planning and controlling costs.

To calculate: The material price variance, material quantity variance, total material variance, direct labor price variance, direct labor quantity variance, and total direct labor variances.

Answer 8

b.

To determine

Introduction: The overhead variance is related to underspending and overspending and it normally includes that cost per indirect labor hour incurred is different than the budgeted. The total overheads variance requires actual manufacturing overheads and applied manufacturing overheads.

To calculate: The total overhead variance.

Answer 9

b.

To determine

Introduction: The overhead variance is related to underspending and overspending and it normally includes that cost per indirect labor hour incurred is different than the budgeted. The total overheads variance requires actual manufacturing overheads and applied manufacturing overheads.

To calculate: The total overhead variance.

Answer 10

c.

To determine

Introduction: Under variance analysis, the standard cost accounting system is used to prepare the income statement. In the standard costing the cost of goods sold is taken according to the standard cost and then the adjustment for favorable and unfavorable variance is made.

To prepare: The income statement.

Answer 11

c.

To determine

Introduction: Under variance analysis, the standard cost accounting system is used to prepare the income statement. In the standard costing the cost of goods sold is taken according to the standard cost and then the adjustment for favorable and unfavorable variance is made.

To prepare: The income statement.

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 26 - Prob. 1Q Ch. 26 - 2. (a) Explain the similarities and differences...Ch. 26 - Prob. 3Q Ch. 26 - Prob. 4Q Ch. 26 - Prob. 5Q Ch. 26 - Prob. 6Q Ch. 26 - Prob. 7Q Ch. 26 - Prob. 8Q Ch. 26 - Prob. 9Q Ch. 26 - Prob. 10Q

Solution Summary: The author explains that the standard costs are an important part of management planning and controlling costs.

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