Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Attached is an assignment for my cost accounting course. Could you please answer this for me, thank you greatly. Cost Accounting Extra Credit Assignment -

Attached is an assignment for my cost accounting course. Could you please answer this for me, thank you greatly.

image text in transcribed Cost Accounting Extra Credit Assignment - 25 points Western Company manufactures special electrical equipment and parts. Western employs a standard cost accounting system with separate standards established for each product. A special transformer is manufactured in the Transformer Department. Production volume is measured by direct labor hours in this department and a flexible budget system is used to plan and control department overhead. Standard costs for the special transformer are determined annually in September for the coming year. The standard cost of a transformer was computed at $57.00 as shown below. Overhead rates were based upon normal and expected monthly capacity, both of which were 4,000 direct labor hours. Practical capacity for this department is 5,000 direct labor hours per month. Variable overhead costs are expected to vary with the number of direct labor hours actually used. During October, 900 transformers were produced. This was below expectations because a work stoppage occurred during contract negotiations with the labor force. Once the contract was settled, the wage rate was increased to $7.25/hour and overtime was scheduled in an attempt to catch up to expected production levels. The following costs were incurred in October: 600 of the 1,400 hours were subject to overtime premium. The total overtime premium is included in variable overhead in accordance with company accounting practices Required: Compute each of the following variances, showing all your work. Be sure to indicate whether the variances are favorable or unfavorable. a. Direct materials price variance b. Direct material efficiency (quantity) variance c. Direct labor rate variance d. Direct labor efficiency variance e. Variable overhead spending variance f. Variable overhead efficiency variance g. Fixed overhead spending (budget) variance h. Production volume variance Submission method: You may send separate files for each part. Name the file Extracreditfirstnamelastname.xls

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting with International Financial Reporting Standards

Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso

4th edition

1119504309, 1-119-50340-8, 9781119503408 , 978-1119504306

More Books

Students also viewed these Accounting questions

Question

Convert from Hexadecimal to Decimal: 4B16= 10

Answered: 1 week ago

Question

Values: What is important to me?

Answered: 1 week ago

Question

Purpose: What do we seek to achieve with our behaviour?

Answered: 1 week ago

Question

An action plan is prepared.

Answered: 1 week ago