You have recently accepted a position with Sea-Jewels Inc., the manufacturer of a popular consumer product. When
Question:
You have recently accepted a position with Sea-Jewels Inc., the manufacturer of a popular consumer product. When trying to open your variance analysis files, you find some of them have become corrupted. All you can retrieve is shown below:
Manufacturing overhead cost is applied to production on the basis of direct labour-hours and that all of the materials purchased during the period were used in production. Since the company uses JIT to control work flows, work in process inventories are insignificant and can be ignored. Use the information you do have to answer the following questions.
Required:
1. How many units were produced last period? (Think hard about this one!)
2. How many kilograms of direct material were purchased and used in production?
3. What was the actual cost per kilogram of material?
4. How many actual direct labour-hours were worked during the period?
5. What was the actual rate paid per direct labour-hour?
6. How much actual variable manufacturing overhead cost was incurred during the period?
7. What is the total fixed manufacturing overhead cost in the company's flexible budget?
8. What were the denominator direct labour-hours for last period?
Step by Step Answer:
Managerial Accounting
ISBN: 9781259275814
11th Canadian Edition
Authors: Ray H Garrison, Alan Webb, Theresa Libby