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Chesser Motors assembles the fully electric Model S-85 automobille at its Delano, California, plant. The standard variable manufacturing cost per vehicle in 2017 is
Chesser Motors assembles the fully electric Model S-85 automobille at its Delano, California, plant. The standard variable manufacturing cost per vehicle in 2017 is $59,400, which consists of: (Click the icon to view the variable cost per vehicle information.) (Click the icon to view additional information.) Chesser started production of the Model S-85 in 2017. The actual production and sales figures for the first three months of the year are: (Click the icon to view the production and sales figures.) (Click the icon to view additional information.) More info Read the requirements. Adj. for production-volume variance (7,770,000) F 11,100,000 U Cost of goods sold $ 112,080,000 $ 243,750,000 (11,100,000) F $ 228,600,000 Operating income $ 52,820,000 52,820 $ 76,350,000 $ 101,200,000 $ 76.350 101,200 Bonus paid to Chaz Muller Chaz Muller is SVP of Chesser and director of the Delano plant. His compensation includes a bonus that is 0.10% of monthly operating income, calculated using absorption costing. Chesser prepares absorption-costing income statements monthly, which include an adjustment for the production-volume variance occurring in that month. There are no variable cost variances or fixed overhead spending variances in the first three months of 2017. The Delano plant is credited with revenue (net of marketing costs) of $97,000 for the sale of each Chesser S-85 vehicle. Requirement 3. How much would the use of variable costing change Muller's bonus each month if the same 0.10% figure were applied to v Complete the top half of the income statement for each month first, then complete the bottom portion. Finally, calculate the bonus paid each any zero balance accounts.) More info Revenues Variable cost of goods sold: Beginning inventory Variable manufacturing costs January 164900000 0 February 320100000 March 329800000 Variable manufacturing overhead is allocated to vehicles on the basis of assembly time. The standard assembly time per vehicle is 15 hours. The Delano plant is highly automated and has a practical capacity of 4,100 vehicles per month. The budgeted monthly fixed manufacturing overhead is $32,190,000. Fixed manufacturing overhead is allocated on the basis of the standard assembly time for the budgeted normal capacity utilization of the plant. For 2017, the budgeted normal capacity utilization is 2,900 vehicles per month. Print Done
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