Swifty Corp. supplies its customers with high-quality canvas tents. These canvas tents sell for $170 each, with the following DM and DL usage and price expectations. Direct materials Direct labor Variable-MOH Fixed-MOH (a) 10 square yards per unit 1.1 DL hours per unit 1.1 DL hours per unit 1.1 DL hours per unit Throughout the year, Swifty used 3,780 DL hours in the process of making 3,500 tents. The company had originally planned to produce and sell 3,200 tents with budgeted fixed-MOH cost of $17,600. Its actual fixed-MOH costs amounted to $17,086 for the year. Determine Swifty's fixed-MOH price and volume variances. Also identify whether the company's fixed-MOH costs were under-or overapplied, and by how much. Fixed-MOH price variance Fixed-MOH $ Fixed-MOH volume variance $ @ $6/square yard @$16/DL hour @$2.80/DL hour @ $5/DL hour $

Swifty Corp. supplies its customers with high-quality canvas tents. These canvas tents sell for $170 each, with the following DM and DL usage and price expectations. Direct materials Direct labor Variable-MOH Fixed-MOH (a) 10 square yards per unit 1.1 DL hours per unit 1.1 DL hours per unit 1.1 DL hours per unit Throughout the year, Swifty used 3,780 DL hours in the process of making 3,500 tents. The company had originally planned to produce and sell 3,200 tents with budgeted fixed-MOH cost of $17,600. Its actual fixed-MOH costs amounted to $17,086 for the year. Determine Swifty's fixed-MOH price and volume variances. Also identify whether the company's fixed-MOH costs were under-or overapplied, and by how much. Fixed-MOH price variance Fixed-MOH $ Fixed-MOH volume variance $ @ $6/square yard @$16/DL hour @$2.80/DL hour @ $5/DL hour $

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter6: Activity-based, Variable, And Absorption Costing

Section: Chapter Questions

Problem 6PA: Box Springs, Inc., makes two sizes of box springs: twin and double. The direct material for the twin...

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Marigold Corp. supplies its customers with high-quality canvas tents. These canvas tents sell for $170 each, with the following DM and DL usage and price expectations. Direct materials 9 square yards per unit @ $5/square yard Direct labor 1.4 DL hours per unit @ $18/DL hour Variable-MOH Fixed-MOH 1.4 DL hours per unit 1.4 DL hours per unit @ $2.80/DL hour @ $4/DL hour Throughout the year, Marigold used 4,795 DL hours in the process of making 3,500 tents. The company had originally planned to produce and sell 3,250 tents with budgeted fixed-MOH cost of $18,200. Its actual fixed-MOH costs amounted to $17,406 for the year. (a) Determine Marigold's fixed-MOH price and volume variances. Also identify whether the company's fixed-MOH costs were under-or overapplied, and by how much. Fixed-MOH price variance $ Fixed-MOH volume variance Fixed-MOH +A $ $
Swifty Corp. supplies its customers with high-quality canvas tents. These canvas tents sell for $170 each, with the following DM and DL usage and price expectations. Direct materials Direct labor Variable-MOH Fixed-MOH (a) Throughout the year, Swifty used 3,780 DL hours in the process of making 3,500 tents. The company had originally planned to produce and sell 3,200 tents with budgeted fixed-MOH cost of $17,600. Its actual fixed-MOH costs amounted to $17,086 for the year. (b) 10 square yards per unit 1.1 DL hours per unit 1.1 DL hours per unit 1.1 DL hours per unit Your answer is correct. Determine Swifty's fixed-MOH price and volume variances. Also identify whether the company's fixed-MOH costs were under-or overapplied, and by how much. Fixed-MOH price variance Fixed-MOH Fixed-MOH volume variance $ (2) $ (3) @ $6/square yard @ $16/DL hour @ $2.80/DL hour No. Account Titles and Explanation (1) @ $5/DL hour 514 1650 2164 Favorable Record the journal entries to accompany the following…
Blue Corp. supplies its customers with high-quality canvas tents. These canvas tents sell for $170 each, with the following DM and DL usage and price expectations. Direct materials 9 square yards per unit @ $4/square yard Direct labor 1.2 DL hours per unit @$12/DL hour Throughout the year, Blue used 32,430 square yards of fabric in the process of making 3,450 tents. The company had originally planned to produce and sell 3,150 tents. In keeping with its desire to hold some DM Inventory at year-end, it purchased 34,380 square yards of canvas at $4.20 per square yard. Blue's DL cost totaled $52,026 for the 4,002 hours that were actually used. (a) Determine Blue's DM and DL price and efficiency variances; specify the amount and sign for all. Price variance $ Efficiency A variance DM A +A DL
Bobcat uses a traditional cost system and estimates next years overhead will be $800.000, as driven by the estimated 25,000 direct labor hours. It manufactures three products and estimates the following costs: If the labor rate is $30 per hour, what is the per-unit cost of each product?
Ed Co. manufactures two types of O rings, large and small. Both rings use the same material but require different amounts. Standard materials for both are shown. At the beginning of the month, Edve Co. bought 25,000 feet of rubber for $6.875. The company made 3,000 large O rings and 4,000 small O rings. The company used 14,500 feet of rubber. A. What are the direct materials price variance, the direct materials quantity variance, and the total direct materials cost variance? B. If they bought 10,000 connectors costing $310, what would the direct materials price variance be for the connectors? C. If there was an unfavorable direct materials price variance of $125, how much did they pay per toot for the rubber?
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Box Springs, Inc., makes two sizes of box springs: twin and double. The direct material for the twin is $25 per unit and $40 s used in direct labor, while the direct material for the double is $40 per unit, and the labor cost is $50 per unit. Box Springs estimates it will make 5,000 twins and 9,000 doubles in the next year. It estimates the overhead for each cost pool and cost driver activities as follows: How much does each unit cost to manufacture?
Gent Designs requires three units of part A for every unit of Al that it produces. Currently, part A is made by Gent, with these per-unit costs in a month when 4.000 units were produced: Variable manufacturing overhead is applied at $1.00 per unit. The other $0.30 of overhead consists of allocated fixed costs. Gent will need 6,000 units of part A for the next years production. Cory Corporation has offered to supply 6,000 units of part A at a price of $7.00 per unit. It Gent accepts the offer, all of the variable costs and $1,200 of the fixed costs will be avoided. Should Gent Designs accept the offer from Cory Corporation?
Jameson Company produces paper towels. The company has established the following direct materials and direct labor standards for one case of paper towels: During the first quarter of the year, Jameson produced 45,000 cases of paper towels. The company purchased and used 135,700 pounds of paper pulp at 0.38 per pound. Actual direct labor used was 91,000 hours at 12.10 per hour. Required: 1. Calculate the direct materials price and usage variances. 2. Calculate the direct labor rate and efficiency variances. 3. Prepare the journal entries for the direct materials and direct labor variances. 4. Describe how flexible budgeting variances relate to the direct materials and direct labor variances computed in Requirements 1 and 2.
Palladium Inc. produces a variety of household cleaning products. Palladium’s controller has developed standard costs for the following four overhead items: Overhead Item Total Fixed Cost Variable Rate per DirectLabor Hour Maintenance $ 86,000 $0.20 Power 0.45 Indirect labor 140,000 2.10 Rent 35,000 Next year, Palladium expects production to require 90,000 direct labor hours. Required: Question Content Area 1. Prepare an overhead budget for the expected level of direct labor hours for the coming year. Palladium Inc.Overhead BudgetFor the Coming Year Variable costs: Rate per Hour Activity Level 90,000 Hours blank Maintenance $fill in the blank ddf6cc027003019_1 $fill in the blank ddf6cc027003019_2 blank Power fill in the blank ddf6cc027003019_3 fill in the blank ddf6cc027003019_4 blank Indirect labor fill in the blank ddf6cc027003019_5 fill in the blank…
Gerber Clothing Inc. has designed a rain suit for outdoor enthusiasts that is about to be introduced on the market. A standard cost card has been prepared for the new suit, as follows: Standard Quantity or hours Standard price or Rate Standard Direct materials 2.2 metres Direct labour 1.0 hours Manufacturing overhead (1/6 variable) 1.0 hours $ 15 per metre 33 per hour 21 per hour Cost $33.00 Total standard cost per suit 33.00 21.00 $87.00 a. The only variable selling and administrative costs will be $6 per suit for shipping. Fixed selling and administrative costs will be as follows (per year): Salaries Advertising and other Total $ 35,400 157,000 $192,400 b. Since the company manufactures many products, it is felt that no more than 10,500 hours of labour time per year can be devoted to production of the new suits. c. An investment of $550,000 will be necessary to carry inventories and accounts receivable and to purchase some new equipment. The company wants a 20% ROI in new product…
Aspen Company produces a special product called Styfex. At the beginning of the year, the company has the following standard cost sheet: Direct materials (5 kilos @ $2.6 per kilo) $13.00 Direct labour (0.75 hour @ $18 per hour) 13.50 Fixed overhead (0.75 hour @ $4 per hour) 3.00 Variable overhead (0.75 hour @ $3 per hour) 2.25 Standard cost per unit $31.75 Aspen Company computes its overhead rates using budgeted volume, which is 54,000 units. The actual results for the year are as follows:  Units produced: 53,000  Direct materials purchased: 274,000 kilograms at $2.50 per kilogram  The direct material used: 270,300 kilograms  Direct labour: 40,100 hours at $17.95 per hour  Fixed overhead: $161,700  Variable overhead: $122,000 Required: Show ALL your workings. i. Calculate direct materials purchase price and quantity variances. ii. Calculate direct labour rate and efficiency variances. iii. Calculate variable overhead spending and efficiency variances. iv. Calculate fixed overhead…