Selected operating information on three different companies for a recent year is given below. Company Full-capacity machine-hoOurs Budgeted machine-hours* Actual machine-hours Standard machine-hours allowed for actual production 38,000 37,000 37,000 27,000 25, 500 26,700 28,000 28, 000 27,000 37, 200 24,900 28,000 *Denominator activity for computing the predetermined overhead rate. Required: For each company, state whether the volume variance would be favorable or unfavorable. (Indicate the effect of cach varlance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (I.e., zero varlance.)) Company A Company B Company C

Selected operating information on three different companies for a recent year is given below. Company Full-capacity machine-hoOurs Budgeted machine-hours* Actual machine-hours Standard machine-hours allowed for actual production 38,000 37,000 37,000 27,000 25, 500 26,700 28,000 28, 000 27,000 37, 200 24,900 28,000 *Denominator activity for computing the predetermined overhead rate. Required: For each company, state whether the volume variance would be favorable or unfavorable. (Indicate the effect of cach varlance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (I.e., zero varlance.)) Company A Company B Company C

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Description: Selected operating information on three different companies for a recent year is given belowCompanyFull-capacity machine-hoursBudgeted machine-hours*Actual machine-hoursStandard machine-hours allowed for actualproduction38,00037,00037,00027,00025, 5

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Assume that a company uses a standard cost system and applies overhead to production based on direct labor-hours. It provided the following excerpt from the standard cost card of its only product: Standard Hours Standard Rate Standard Cost Fixed manufacturing overhead 2 hours $ 6.00 per hour $ 12.00 During the most recent period, the following additional information was available: The total actual fixed overhead cost was $275,000. The budgeted amount of fixed overhead cost was $285,000. 46,000 direct labor-hours were actually used to produce 24,100 units. What is the standard hours allowed for the actual output?
Calculate appropriate overhead absorption rates for the three production departments.
ABC Company listed the following data for the current year: Budgeted factory overhead $1,116,000 Budgeted direct labor hours 72,000 Budgeted machine hours 24,000 Actual factory overhead 1,038,100 Actual labor hours 71,200 Actual machine hours 22,000 Assuming ABC Company applied overhead based on direct labor hours, the company's predetermined overhead rate for the year is: Multiple Choice $47.19 per direct labor hour. $16.00 per direct labor hour. $15.50 per direct labor hour. $14.58 per direct labor hour. $14.50 per direct labor hour.
During the period, Shalom Company produced 8,000 units and applied overhead based on the direct labor hours. The standard cost card showed the following information: Standard Direct labor hours per unit Actual Direct labor hours Standard Fixed overhead per DLH Standard Variable overhead per DLH Budgeted variable overhead Actual Variable overhead cost Budgeted fixed overhead 3 25,000 P1.90 P2.20 P48,000 P51,000 P55,000 P57,500 Actual Fixed overhead cost Determine the variances based on the information above. Indicate as favorable or unfavorable. Format should be: 8,000 F or 8,000 UF No need to indicate if the amount is positive or negative. Amounts must be in whole numbers. Example: 88,000 or (88,000) Unit costs be in whole numbers. Example: 88 Format of percentages: 88% Words must be in capital letters. What is the variable overhead spending variance?
Give typing answer with explanation and conclusion to all parts
During the period, Shalom Company produced 8,000 units and applied overhead based on the direct labor hours. The standard cost card showed the following information: Standard Direct labor hours per unit Actual Direct labor hours Standard Fixed overhead per DLH Standard Variable overhead per DLH Budgeted variable overhead Actual Variable overhead cost Budgeted fixed overhead 3 25,000 P1.90 P2.20 P48,000 P51,000 P55,000 P57,500 Actual Fixed overhead cost Determine the variances based on the information above. Indicate as favorable or unfavorable. Format should be: 8,000 F or 8,000 UF No need to indicate if the amount is positive or negative. Amounts must be in whole numbers. Example: 88,000 or (88,000) Unit costs be in whole numbers. Example: 88 Format of percentages: 88% Words must be in capital letters. What is the fixed overhead budget variance?
In December, a company was calculating the predetermined factory overhead rate for the upcoming year, based on machine hours, using the following estimated costs: direct materials $ 550,000, direct labor $ 350,000; factory overhead $ 175,000, sales expenses $ 40,000, general and administrative expenses $ 35,000. The following estimates were also available: direct labor hours 500; machine hours 250 Calculate the predetermined overhead rate for the upcoming year. Multiple Choice $500 per direct labor hour. $650 per machine hour. $350 per direct labor hour. $500 per direct labor hour. $650 per machine hour. $350 per direct labor hour. $1,000 per machine hour. $700 per machine hour.
A company estimated the manufacturing overhead costs for the coming year at $420,00 The total estimated direct labor hours are 15,000 hours, and the estimated machine hou to be worked are 6,000 hours. The company allocates its manufacturing overhead cos based on the direct labor hours. What is the pre-determined overhead allocation rate? a. $20 per direct labor hour b. $70 per machine hour c. $28 per machine hour d. $28 per direct labor hour Answer O A O B OD
Mountain Peaks applies overhead on the basis of machine hours and reports the following information: Budget Actual $150,000 30,000 Overhead Machine hours Direct materials Direct labor A. What is the predetermined overhead rate? 5✓ per machine hour B. How much overhead was applied during the year? 135,000✔ machine hours $144,000 27,000 $210,000 $350,000 C. Was overhead over- or underapplied, and by what amount? 9,000 ✓ Underapplied Feedback Check My Work Use budgeted amounts to calculate the predetermined overhead rate. The amount is then used to determine the overhead applied (along with ot overapplied. D. What is the journal entry to dispose of the over- or underapplied overhead? If an amount box does not require an entry, leave it blank. Cost of Goods Sold 18 Manufacturing Overhead
Mountain Peaks applies overhead on the basis of machine hours and reports the following information: Budget Actual $150,000 30,000 Overhead Machine hours Direct materials Direct labor $144,000 27,000 $210,000 $350,000 A. What is the predetermined overhead rate? per machine hour B. How much overhead was applied during the year? machine hours C. Was overhead over- or underapplied, and by what amount? Underapplied
Michelle Company uses the Activity-based costing. It has identified the following overhead costs and cost drivers for the coming year; Budgeted cost P36,000 Overhead item Cost driver Budgeted Activity level No. of setups No. of inspections Machine set-up Inspection Material handling Engineering Budgeted direct labor cost was P100,000, and budgeted direct material cost was P280,000. The following information was collected on three jobs that were completed during the year: 900 120,000 4,000 No. of material moves 80,000 8,000 Engineering hours 60,000 3,000 Job 210 12,000 Job 220 Job 230 Direct materials 9,000 10,000 Direct labor 18,000 13,500 140 15,000 Units completed 100 200
The following information is available from the cost records of a Company for the month of July, 2018 : (1) Material purchased (2) Material consumed (3) Actual wages paid for (4) Fixed Factory overhead incurred (5) Fixed Factory overhead budgeted (6) Units produced (7) Standard rates and prices are : $90,000 22,000 pieces 21,000 pieces 5,150 hours $25,750 $ 46,000 $42,000 1,900 $ 4.50 per piece 10 pieces per unit $ 6 per hour 2.5 hours per unit $ 8 per labour hour You are required to calculate : (i) Material price variance; (ii) Material usage variance; (iii) Direct material Standard input Direct labour rate Standard requirement Overhead Labour rate variance; (iv) Labour efficiency variance; (v) Fixed overhead expenditure variance