Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Ayala Corporation accumulates the following data relative to jobs started and finished during the month of June 2017. Costs and Production Data Actual Standard Raw

Ayala Corporation accumulates the following data relative to jobs started and finished during the month of June 2017.

Costs and Production Data

Actual

Standard

Raw materials unit cost $2.00 $1.85
Raw materials units used 11,500 10,900
Direct labor payroll $163,900 $159,600
Direct labor hours worked 14,900 15,200
Manufacturing overhead incurred $223,976
Manufacturing overhead applied $226,176
Machine hours expected to be used at normal capacity 42,500
Budgeted fixed overhead for June $72,250
Variable overhead rate per machine hour $3.10
Fixed overhead rate per machine hour $1.70

Overhead is applied on the basis of standard machine hours. 3.10 hours of machine time are required for each direct labor hour. The jobs were sold for $456,000. Selling and administrative expenses were $36,500. Assume that the amount of raw materials purchased equaled the amount used.

Compute all of the variances for (1) direct materials and (2) direct labor. (Round answers to 0 decimal places, e.g. 125.)

(1) Total materials variance $

FavorableUnfavorableNeither favorable nor unfavorable

Materials price variance $

FavorableUnfavorableNeither favorable nor unfavorable

Materials quantity variance $

FavorableUnfavorableNeither favorable nor unfavorable

(2) Total labor variance $

FavorableUnfavorableNeither favorable nor unfavorable

Labor price variance $

FavorableUnfavorableNeither favorable nor unfavorable

Labor quantity variance $

FavorableUnfavorableNeither favorable nor unfavorable

Compute the total overhead variance.

Total overhead variance

Prepare an income statement for management. (Ignore income taxes.) (Round answers to 0 decimal places, e.g. 125.)

(I have answered all the above correctly but I need help with preparing the income statement)

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

Step: 3

blur-text-image

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

Managerial Accounting Tools For Business Decision Making

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

2nd Canadian Edition

0471413658, 978-0471413653

More Books

Students also viewed these Accounting questions

Question

Under what circumstances are pay differentials justified?

Answered: 1 week ago