in an assembly-line process. Labor costs incurred during a recent period were: corporate executives, $555,000; assembly-line workers, $187,000; security guards, $55,000; and plant supervisor, $137,000. What is the total of Guaranteed’s direct labor c
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Guaranteed Appliance Co. produces washers and dryers in an assembly-line process. Labor costs incurred during a recent period were: corporate executives, $555,000; assembly-line workers, $187,000; security guards, $55,000; and plant supervisor, $137,000. What is the total of Guaranteed’s direct labor cost?
Direct labour cost is the wages paid to the workers who are directly involved in the making of the product.
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- Rulers Company is a neon sign company that estimated overhead will be $60,000, consisting of 1,500 machine hours. The cost to make Job 416 is $95 in neon, 15 hours of labor at $13 per hour, and five machine hours. During the month, it incurs $95 in indirect material cost, $130 in administrative labor, $320 in utilities, and $350 in depreciation expense. What is the predetermined overhead rate if machine hours are considered the cost driver? What is the cost of Job 416? What is the overhead incurred during the month?Hicks Contracting collects and analyzes cost data in order to track the cost of installing decks on new home construction jobs. The following are some of the costs that they incur. Classify these costs as fixed or variable costs and as product or period costs. Lumber used to construct decks ($12.00 per square foot) Carpenter labor used to construct decks ($10 per hour) Construction supervisor salary ($45,000 per year) Depreciation on tools and equipment ($6,000 per year) Selling and administrative expenses ($35,000 per year) Rent on corporate office space ($34,000 per year) Nails, glue, and other materials required to construct deck (varies per job)Roper Furniture manufactures office furniture and tracks cost data across their process. The following are some of the costs that they incur. Classify these costs as fixed or variable costs, and as product costs or period costs. A. Wood used to produce desks ($125.00 per desk) B. Production labor used to produce desks ($15 per hour) C. Production supervisor salary ($45,000 per year) D. Depreciation on factory equipment ($60,000 per year) E. Selling and administrative expenses ($45,000 per year) F. Rent on corporate office ($44,000 per year) G. Nails, glue, and other materials required to produce desks (varies per desk) H. Utilities expenses for production facility I. Sales staff commission (5% of gross sales)
- Smithson Electric provides residential and business electric... [The following information applies to the questions displayed below.] Smithson Electric provides residential and business electric repair services. While direct labor and materials costs are traced to individual customers, administrative labor and transportation costs are considered overhead and applied as a percentage of direct labor costs. At the beginning of the year, Smithson estimates $10,000 of overhead costs and $50,000 of direct labor costs. Actual costs for the year are $12,000 for overhead and $48,000 for direct labor. Ending balances for WIP Inventory, Finished Goods Inventory, and Cost of Goods Sold are $4,000, $15,000, and $141,000 respectively. PR 4-5 (Static) Questions a-c. Answer the following questions based on the details provided. Question a. What is Smithson's predetermined overhead rate as a percentage of direct labor? Note: Round your answer to the nearest percent. b. The Jackson account accumulated…ABC Co. produces washers and dryers in an assembly-line process. Labor costs incurred during a recent period were: corporate executives, $500,000; assembly-line workers, $180,000; security guards, $45,000; and plant supervisor, $110,000. The total of ABC’s direct labor cost was: a. $235,000 b. $110,000 c. $155,000 d. $180,000At the beginning of the year, Learer Company's manager estimated total direct labor cost to be $2,510,000. The manager also estimated the following overhead costs for the year. Indirect labor. Rent on factory building Factory utilities Depreciation-Factory equipment Repairs expense-Factory equipment Indirect materials Total estimated overhead costs For the year, the company incurred $1,523,000 of actual overhead costs. It completed and sold five jobs with the following direct labor costs: Job 201, $605,000; Job 202, $564,000; Job 203, $299,000; Job 204, $717,000; and Job 205, $315,000. In addition, Job 206 is in process at the end of the year and had been charged $18,000 for direct labor. No jobs were in process at the beginning of the year. The company's predetermined overhead rate is based on a percent of direct labor cost. Required 1-a. Determine the predetermined overhead rate for the year. 1-b. Determine the overhead applied to each of the six jobs during the year. 1-c. Determine…
- Morris Corp applies manufacturing overhead cost to Jobs (to the work in process account) at a rate of $50 per direct labor hour (DLH). For the year, actual overhead costs totaled $240,000, and 5,000 DLHs were worked by the company's employees. a. How much overhead cost was applied to the work in process account? b. Was manufacturing overhead overapplied, or underapplied.The Company manufactures furniture at its central Kentucky factory. Some of its costs from the past year include: Wages paid to maintenance workers $60,700 Fabric used to upholster furniture $80,500 Wages paid to assembly-line workers $100,200 Lumber used to build product $15,100 Sales commissions $7700 Insurance costs for factory $21,900 Freight-in (on raw materials) $3900 Utilities in factory $12,400 Factory supervisor salary $60,100 Depreciation on factory equipment $18,200 Utilities in sales office $26,400 Costs of delivery to customers $8500 Depreciation on sales office $1700 Lubricants used in factory equipment $500 Direct material costs for the Company totaled $15,100. $95,600. $99,500. $80,500.15. When producing tables, a company incurs the following costs: $30 for screws, $6,500 for wood, $80 for wood stain, $5,000 paid to janitors who clean the production facilities, $2,100 paid to employees who saw and prepare wood for production, and $1,600 for depreciation on equipment. How much factory overhead cost would need to be allocated to the tables produced?
- Johansen Corporation uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. The Corporation has provided the following estimated costs for the next year: Direct materials $ 6,000 Direct labor $ 20,000 Rent on factory building $ 15,000 Sales salaries $ 25,000 Depreciation on factory equipment $ 8,000 Indirect labor $ 12,000 Production supervisor's salary $ 15,000 Jameson estimates that 20,000 direct labor-hours will be worked during the year. The predetermined overhead rate per hour will be:Calgary Manufacturing company makes chairs and desks. The following costs were incurred in making its products during its first year of operation. Chairs Desks TotalDirect Materials $ 7,000 $9,000 $16,000Direct Labor 15,000 11,000 26,000 Also the company incurred $19,760 of employee benefits cost. Since these overhead costs are driven by the use of labor they are allocated to the products based on the direct labor dollars. Based on this information alone the total cost of making chairs is Note: Do not round intermediate calculationJohansen Corporation uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. The Corporation has provided the following estimated costs for the next year: Direct materials $16,000 Direct labor $20,000 Rent on factory building $25,000 Sales salaries $25,000 Depreciation on factory equipment $8,000 Indirect labor $16,000 Production supervisor's salary $35,000 Jameson estimates that 25,000 direct labor-hours will be worked during the year. The predetermined overhead rate per hour will be: Group of answer choices 3.36 4.00 5.45 6.45