Logistics Solutions maintains warehouses that stock items carried by its dot.com clients. When a client receives an order from a customer, the order is forwarded to Logistics Solutions, which pulls the item from storage, packs it, and ships it to the customer. The company uses a predetermined variable overhead rate based on direct labor-hours. In the most recent month, 125,000 items were shipped to customers using 4,400 direct labor-hours. The company incurred a total of $12,540 in variable overhead costs. According to the company's standards, 0.04 direct labor-hour is required to fulfill an order for one item and the variable overhead rate is $2.90 per direct labor-hour. Required: 1 What is the standard labor-hours allowed (SH) to ship 125,000 items to customers? 2. What is the standard variable overhead cost allowed (SH SR) to ship 125,000 items to customers? 3. What is the variable overhead spending variance? 4. What are the variable overhead rate variance and the variable overhead efficiency variance? Note: For requirements 3 and 4, indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (.e., zero variance). Input all amounts as positive values. Do not round intermediate calculations. Standard quantity of labor-hours allowed Standard variable overhead cost allowed Variable overhead spending variance

Lehighton Chalk Company manufactures sidewalk chalk, which it sells online by the box at $25 per unit. Lehighton uses an actual costing system, which means that the actual costs of direct material, direct labor, and manufacturing overhead are entered into work-in-process inventory. The actual application rate for manufacturing overhead is computed each year; actual manufacturing overhead is divided by actual production (in units) to compute the application rate. Information for Lehighton's first two years of operation is as follows: Sales (in units) Production (in units) Production costs: Variable manufacturing costs Fixed manufacturing overhead Selling and administrative costs: Variable Fixed Based on absorption costing Finished-goods inventory Retained earnings Year 1 2,600 3,100 $15,500 18,600 Based on variable costing Finished-goods inventory Retained earnings LEHIGHTON CHALK COMPANY Selected Balance Sheet Information End of Year 1 10,400 9,400 $ 5,500 11,100 Selected information…

The Gilster Company, a machine tooling firm, has several plants. One plant, located in St. Cloud, Minnesota, uses a job order costing system for its batch production processes. The St. Cloud plant has two departments through which most jobs pass. Plant-wide overhead, which includes the plant manager’s salary, accounting personnel, cafeteria, and human resources, is budgeted at $400,000. During the past year, actual plantwide overhead was $385,000. Each department’s overhead consists primarily of depreciation and other machine-related expenses. Selected budgeted and actual data from the St. Cloud plant for the past year are as follows.     Department A   Department B Budgeted department overhead               (excludes plantwide overhead) $ 153,000     $ 439,900   Actual department overhead   170,000       459,900   Expected total activity:               Direct labor hours   50,000       25,000   Machine-hours   15,000       53,000   Actual activity:…

Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production information follows: Direct materials cost per unit Direct labor cost per unit Sales price per unit Expected production per month Harbour has monthly overhead of $177,870, which is divided into the following activity pools: Setup costs Quality control Maintenance Total $ 72,000 66,270 39,600 $ 177,870 Number of setups Number of inspections Number of machine hours Home $38 20 354 790 units Home Work 49 41 320 1,200 2,100 385 The company also has compiled the following information about the chosen cost drivers: Work Total 90 705 3,300 $65 35 572 340 units Required: 1. Suppose Harbour uses a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line. 2. Calculate the production cost per unit for each of Harbour's products under a traditional costing system. 3. Calculate Harbour's gross margin per unit for each product under…

Logistics Solutions provides order fulfillment services for dot.com merchants. The company maintains warehouses that stock items carried by its dot.com clients. When a client receives an order from a customer, the order is forwarded to Logistics Solutions, which pulls the item from storage, packs it, and ships it to the customer. The company uses a predetermined variable overhead rate based on direct labor-hours. In the most recent month, 145,000 items were shipped to customers using 5,600 direct labor-hours. The company incurred a total of $17,080 in variable overhead costs. According to the company's standards, 0.04 direct labor-hours are required to fulfill an order for one item and the variable overhead rate is $3.10 per direct labor-hour. Required: 1. What is the standard labor-hours allowed (SH) to ship 145,000 items to customers? 2. What is the standard variable overhead cost allowed (SH x SR) to ship 145,000 items to customers? 3. What is the variable overhead spending…

Logistics Solutions provides order fulfillment services for dot.com merchants. The company maintains warehouses that stock items carried by its dot.com clients. When a client receives an order from a customer, the order is forwarded to Logistics Solutions, which pulls the item from storage, packs it, and ships it to the customer. The company uses a predetermined variable overhead rate based on direct labor-hours. In the most recent month, 180,000 items were shipped to customers using 7.700 direct labor-hours. The company incurred a total of $26,180 in variable overhead costs. According to the company's standards, 0.03 direct labor-hours are required to fulfill an order for one item and the variable overhead rate is $3.45 per direct labor-hour. Required: 1. What is the standard labor-hours allowed (SH) to ship 180,000 items to customers? 2. What is the standard variable overhead cost allowed (SHSR) to ship 180,000 items to customers? 3. What is the variable overhead spending variance?…

Logistics Solutions maintains warehouses that stock items carried by its dot.com clients. When a client receives an order from a customer, the order is forwarded to Logistics Solutions, which pulls the item from storage, packs it, and ships it to the customer. The company uses a predetermined variable overhead rate based on direct labor-hours. In the most recent month, 125,000 items were shipped to customers using 4,400 direct labor-hours. The company incurred a total of $12,540 in variable overhead costs. According to the company's standards, 0.04 direct labor-hour is required to fulfill an order for one item and the variable overhead rate is $2.90 per direct labor-hour. Required: 1. What is the standard labor-hours allowed (SH) to ship 125,000 items to customers? 2. What is the standard variable overhead cost allowed (SH × SR) to ship 125,000 items to customers? 3. What is the variable overhead spending variance? 4. What are the variable overhead rate variance and the variable…

Delph Company uses job-order costing with a plantwide predetermined overhead rate based on machine-hours. At the beginning of the year, the company estimated that 54,000 machine-hours would be required for the period’s estimated level of production. It also estimated $1,000,000 of fixed manufacturing overhead cost for the coming period and variable manufacturing overhead of $4.00 per machine-hour. Because Delph has two manufacturing departments—Molding and Fabrication—it is considering replacing its plantwide overhead rate with departmental rates that would also be based on machine-hours. The company gathered the following information to enable calculating departmental overhead rates:   Molding Fabrication Total Machine-hours 23,000 31,000 54,000 Fixed manufacturing overhead cost $ 760,000 $ 240,000 $ 1,000,000 Variable manufacturing overhead cost per machine-hour $ 4.00 $ 1.00   During the year, the company had no beginning or ending inventories and it started,…

The Platter Valley factory of Bybee Industries manufactures field boots. The cost of each boot includes direct materials, direct labor, and manufacturing (factory) overhead. The firm traces all direct costs to products, and it assigns overhead cost to products based on direct labor hours. The company budgeted $9,600 variable factory overhead cost, $92,000 for fixed factory overhead cost and 2,000 direct labor hours (its practical capacity) to manufacture 4,000 pairs of boots in March. The factory used 3,700 direct labor hours in March to manufacture 3,800 pairs of boots and spent $16,800 on variable overhead during the month. The actual fixed overhead cost incurred for the month was $95,000. Required: 1. Compute the variable overhead spending (rate) variance, the variable overhead efficiency variance, and the total variable overhead variance for March and state whether each variance is favorable (F) or unfavorable (U). 2. Provide the appropriate journal entry to record the variable…

During a recent accounting period, Falcon Express’ shipping department processed 22 orders. Each order typically takes four hours to complete. However, the average time increased to five hours because of various departmental inefficiencies. If shipping labor is paid $15 per hour, what would the company's non-value-added cost be?