Kyler manufactures coffee mugs that it sells to other companies for customizing with their own logos. Kyler prepares flexible budgets and uses a standard cost system to control manufacturing costs. The standard unit cost of a coffee mug is based on static budget volume of coffee mugs per month:
Data table More info a. There were no beginning or ending inventory balances. All expenditures were on account. b. Actual production and sales were 62,800 coffee mugs. c. Actual direct materials usage was 10,000lbs. at an actual cost of $0.17perlb. d. Actual direct labor usage was 201,000 minutes at a total cost of $32,160. e. Actual overhead cost was $8,040 variable and $32,660 fixed. f. Selling and administrative costs were $123,000. Select the required formulas, compute the efficiency variances for direct materials and direct labor, and identify whethe (Abbreviations used: AC= actual cost; AQ= actual quantity; FOH= fixed overhead; SC= standard cost; SQ= standaro Requirement 2. Journalize the purchase and usage of direct materials and the assignment of direct labor, including the related variances. (Record deb the explanation on the last line of the journal entry table.) Begin by journalizing the purchase of direct materials, including the related variance. (Prepare a single compound journal entry.) the explanation on the last line of the journal entry table.) Begin by journalizing the purchase of direct materials, including the related variance. (Prepare a single compound journal entry.) Now, journalize the usage of direct materials, including the related variance. (Prepare a single compound journal entry.) Requirement 3. For manufacturing overhead, compute the variable overhead cost and efficiency variances and the fixed overhead cost and volume variances. Begin with the variable overhead cost and efficiency variances. Select the required formulas, compute the variable overhead cost and efficiency variances, and identify whether Now compute the fixed overhead cost and volume variances. Select the required formulas, compute the fixed overhead cost variance is favorable (F) or unfavorable (U). (Abbreviations used: AC= actual cost; AQ= actual quantity; FOH= fixed overhe Kequirement 4. Journalize the actual manutacturing overhead and the allocated manutacturing overhead. Journalize the movement ot all production costs trom Work-in-Hrocess Inventory. Journalize the adjusting of the Manufacturing Overhead account. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Begin by journalizing the entry to show the actual manufacturing overhead costs incurred. Journalize the applied manufacturing overhead. Journalize the movement of all production from Work-in-Process Inventory. Journalize the adjusting of the Manufacturing Overhead account. (Prepare a single compound journal entry.) Requirement 5. Kyler intentionally hired more highly skilled workers during July. How did this decision affect the cost variances? Overall, was the decision wise? Hiring more-skilled, higher-paid labor led to direct labor cost variance. Given the direct labor efficiency variance, it appear that these more-skilled workers performed efficiently. The overall net effect is thus management's decision was Data table More info a. There were no beginning or ending inventory balances. All expenditures were on account. b. Actual production and sales were 62,800 coffee mugs. c. Actual direct materials usage was 10,000lbs. at an actual cost of $0.17perlb. d. Actual direct labor usage was 201,000 minutes at a total cost of $32,160. e. Actual overhead cost was $8,040 variable and $32,660 fixed. f. Selling and administrative costs were $123,000. Select the required formulas, compute the efficiency variances for direct materials and direct labor, and identify whethe (Abbreviations used: AC= actual cost; AQ= actual quantity; FOH= fixed overhead; SC= standard cost; SQ= standaro Requirement 2. Journalize the purchase and usage of direct materials and the assignment of direct labor, including the related variances. (Record deb the explanation on the last line of the journal entry table.) Begin by journalizing the purchase of direct materials, including the related variance. (Prepare a single compound journal entry.) the explanation on the last line of the journal entry table.) Begin by journalizing the purchase of direct materials, including the related variance. (Prepare a single compound journal entry.) Now, journalize the usage of direct materials, including the related variance. (Prepare a single compound journal entry.) Requirement 3. For manufacturing overhead, compute the variable overhead cost and efficiency variances and the fixed overhead cost and volume variances. Begin with the variable overhead cost and efficiency variances. Select the required formulas, compute the variable overhead cost and efficiency variances, and identify whether Now compute the fixed overhead cost and volume variances. Select the required formulas, compute the fixed overhead cost variance is favorable (F) or unfavorable (U). (Abbreviations used: AC= actual cost; AQ= actual quantity; FOH= fixed overhe Kequirement 4. Journalize the actual manutacturing overhead and the allocated manutacturing overhead. Journalize the movement ot all production costs trom Work-in-Hrocess Inventory. Journalize the adjusting of the Manufacturing Overhead account. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Begin by journalizing the entry to show the actual manufacturing overhead costs incurred. Journalize the applied manufacturing overhead. Journalize the movement of all production from Work-in-Process Inventory. Journalize the adjusting of the Manufacturing Overhead account. (Prepare a single compound journal entry.) Requirement 5. Kyler intentionally hired more highly skilled workers during July. How did this decision affect the cost variances? Overall, was the decision wise? Hiring more-skilled, higher-paid labor led to direct labor cost variance. Given the direct labor efficiency variance, it appear that these more-skilled workers performed efficiently. The overall net effect is thus management's decision was
