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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Required information Skip to question [The following information applies to the questions displayed below.]Brianna's Boutique has the following transactions related to its top-selling Gucci purse for the month of October. Brianna's Boutique uses a periodic inventory system. Date Transactions Units Unit Cost Total Cost October 1 Beginning inventory 6 $830 $4,980 October 4 Sale 4 October 10 Purchase 5 840 4,200 October 13 Sale 3 October 20 Purchase 4 850 3,400 October 28 Sale 7 October 30 Purchase 6 860 5,160 $17,740 2. Using FIFO, calculate ending inventory and cost of goods sold at October 31.

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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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