Pacific Company provides the following information about its budgeted and actual results for June 2013. Although the
Question:
Pacific Company provides the following information about its budgeted and actual results for June 2013. Although the expected June volume was 25,000 units produced and sold, the company actually produced and sold 27,000 units as detailed here:
Standard costs based on expected output of 25,000 units
Actual costs incurred to produce 27,000 units
Standard costs based on expected output of 27,000 units
Required 1. Prepare June flexible budgets showing expeeted sales, costs, and net income assuming 20,000, 25,000, and 30,000 units of output produced and sold.
2. Prepare a flexible budget performance report that compares actual results with the amounts budgeted if the actual volume had been expected.
3. Apply variance analysis for direct materials and direct labor.
4. Compute the total overhead variance, and the controllable and volume variances.
5. Compute spending and efficiency variances for overhead. (Refer to Appendix 23A.)
6. Prepare journal entries to record standard costs, and price and quantity variances, for direct materials, direct labor, and factory overhead. (Refer to Appendix 23A.)
Step by Step Answer:
Fundamental Accounting Principles Volume 2
ISBN: 9780077716660
21st Edition
Authors: John Wild, Ken Shaw, Barbara Chiappetta