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6/17/2016 Chapter 8 Homework (19) Brewer 7th edition: BUAD162 - Managerial Accounting Summer (1) 2016 Chapter 8 - Homework (1-9) 1. diego merisma instructions | help value: 1.00 points Exercise 8-1 Prepare a Flexible Budget [LO8-1] Puget Sound Divers is a company that provides diving services such as underwater ship repairs to clients in the Puget Sound area. The company's planning budget for May appears below: Puget Sound Divers Planning Budget For the Month Ended May 31 Budgeted divinghours (q) Revenue ($380.00q) Expenses: Wages and salaries ($11,900 + $124.00q) Supplies ($4.00q) Equipment rental ($2,400 + $21.00q) Insurance ($4,100) Miscellaneous ($510 + $1.48q) Total expense Net operating income 350 $ 133,000 55,300 1,400 9,750 4,100 1,028 71,578 $ 61,422 Required: During May, the company's activity was actually 340 divinghours. Complete the following flexible budget for that level of activity. (Round your answers to nearest whole dollar.) Puget Sound Divers Flexible Budget For the Month Ended May 31 Revenue Expenses: Wages and salaries Supplies Equipment rental Insurance Miscellaneous Total expense Net operating income Hints References eBook & Resources Hint #1 http://ezto.mheducation.com/hm.tpx?_=0.6473090891948566_1466194226696 1/2 6/17/2016 Chapter 8 Homework (19) Check my work 2016 McGraw-Hill Education. All rights reserved. http://ezto.mheducation.com/hm.tpx?_=0.6473090891948566_1466194226696 2/2 6/17/2016 Chapter 8 Homework (19) Brewer 7th edition: BUAD162 - Managerial Accounting Summer (1) 2016 Chapter 8 - Homework (1-9) 2. diego merisma instructions | help value: 1.25 points Exercise 8-2 Prepare a Report Showing Revenue and Spending Variances [LO8-2] Quilcene Oysteria farms and sells oysters in the Pacific Northwest. The company harvested and sold 7,000 pounds of oysters in August. The company's flexible budget for August appears below: Quilcene Oysteria Flexible Budget For the Month Ended August 31 Actual pounds (q) Revenue ($4.20q) Expenses: Packing supplies ($0.25q) Oyster bed maintenance ($3,200) Wages and salaries ($2,300 + $0.25q) Shipping ($0.70q) Utilities ($1,250) Other ($440 + $0.01q) Total expense Net operating income 7,000 $ 29,400 1,750 3,200 4,050 4,900 1,250 510 15,660 $ 13,740 The actual results for August appear below: Quilcene Oysteria Income Statement For the Month Ended August 31 Actual pounds 7,000 Revenue $ 26,700 Expenses: Packing supplies 1,920 Oyster bed maintenance 3,060 Wages and salaries 4,460 Shipping 4,630 Utilities 1,060 Other 1,130 Total expense 16,260 Net operating income $ 10,440 Required: Compute the company's revenue and spending variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) http://ezto.mheducation.com/hm.tpx 1/2 6/17/2016 Chapter 8 Homework (19) Quilcene Oysteria Revenue and Spending Variances For the Month Ended August 31 Revenue Expenses: Packing supplies Oyster bed maintenance Wages and salaries Shipping Utilities Other Total expense Net operating income Hints References eBook & Resources Hint #1 Check my work 2016 McGraw-Hill Education. All rights reserved. http://ezto.mheducation.com/hm.tpx 2/2 6/17/2016 Chapter 8 Homework (19) Brewer 7th edition: BUAD162 - Managerial Accounting Summer (1) 2016 Chapter 8 - Homework (1-9) 3. diego merisma instructions | help value: 1.25 points Exercise 8-3 Prepare a Flexible Budget with More Than One Cost Driver [LO8-3] Alyeski Tours operates day tours of coastal glaciers in Alaska on its tour boat the Blue Glacier. Management has identified two cost driversthe number of cruises and the number of passengersthat it uses in its budgeting and performance reports. The company publishes a schedule of day cruises that it may supplement with special sailings if there is sufficient demand. Up to 87 passengers can be accommodated on the tour boat. Data concerning the company's cost formulas appear below: Vessel operating costs Advertising Administrative costs Insurance Fixed Cost Per Month $ 6,000 $ 2,300 $ 5,700 $ 3,700 Cost per Cost per Cruise Passenger $ 476.00 $ 3.20 $ 34.00 $ 1.50 For example, vessel operating costs should be $6,000 per month plus $476.00 per cruise plus $3.20 per passenger. The company's sales should average $33.00 per passenger. The company's planning budget for July is based on 57 cruises and 3,050 passengers. Required: Complete the company's planning budget for July. Hints References eBook & Resources Hint #1 Check my work 2016 McGraw-Hill Education. All rights reserved. http://ezto.mheducation.com/hm.tpx 1/1 6/17/2016 Chapter 8 Homework (19) Brewer 7th edition: BUAD162 - Managerial Accounting Summer (1) 2016 Chapter 8 - Homework (1-9) 4. diego merisma instructions | help value: 1.25 points Exercise 8-4 Direct Materials Variances [LO8-4] Bandar Industries Berhad of Malaysia manufactures sporting equipment. One of the company's products, a football helmet for the North American market, requires a special plastic. During the quarter ending June 30, the company manufactured 3,100 helmets, using 2,201 kilograms of plastic. The plastic cost the company $14,527. According to the standard cost card, each helmet should require 0.62 kilograms of plastic, at a cost of $7.00 per kilogram. Required: 1. According to the standards, what cost for plastic should have been incurred to make 3,100 helmets? How much greater or less is this than the cost that was incurred? (Round Standard kilograms of plastic per helmet to 2 decimal places.) 2. Break down the difference computed in (1) above into a materials price variance and a materials quantity variance. (Round your actual materials price to two decimal places, and round your final answers to the nearest whole dollar. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).) http://ezto.mheducation.com/hm.tpx 1/2 6/17/2016 Chapter 8 Homework (19) rev: 10_13_2014_QC_56637 Hints References eBook & Resources Hint #1 Check my work 2016 McGraw-Hill Education. All rights reserved. http://ezto.mheducation.com/hm.tpx 2/2 6/17/2016 Chapter 8 Homework (19) diego merisma Brewer 7th edition: BUAD162 - Managerial Accounting Summer (1) 2016 Chapter 8 - Homework (1-9) 5. instructions | help value: 1.25 points Exercise 8-5 Direct Labor Variances [LO8-5] SkyChefs, Inc., prepares inflight meals for a number of major airlines. One of the company's products is grilled salmon in dill sauce with baby new potatoes and spring vegetables. During the most recent week, the company prepared 4,800 of these meals using 1,400 direct laborhours. The company paid these direct labor workers a total of $18,200 for this work, or $13.00 per hour. According to the standard cost card for this meal, it should require 0.30 direct laborhours at a cost of $12.50 per hour. Required: 1. According to the standards, what direct labor cost should have been incurred to prepare 4,800 meals? How much does this differ from the actual direct labor cost? (Round laborhours per meal and labor cost per hour to 2 decimal places.) Number of meals prepared Standard direct laborhours per meal Total direct laborhours allowed Standard direct labor cost per hour Total standard direct labor cost Actual cost incurred Total standard direct labor cost Total direct labor variance 2. Break down the difference computed in (1) above into a labor rate variance and a labor efficiency variance. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).) Labor rate variance Labor efficiency variance rev: 10_13_2014_QC_56638, 10_24_2014_QC_57357 http://ezto.mheducation.com/hm.tpx 1/2 6/17/2016 Chapter 8 Homework (19) Hints References eBook & Resources Hint #1 Check my work 2016 McGraw-Hill Education. All rights reserved. http://ezto.mheducation.com/hm.tpx 2/2 6/17/2016 Chapter 8 Homework (19) Brewer 7th edition: BUAD162 - Managerial Accounting Summer (1) 2016 Chapter 8 - Homework (1-9) 6. value: diego merisma instructions | help 1.25 points Exercise 8-6 Variable Overhead Variances [LO8-6] Logistics Solutions provides order fulfillment services for dot.com merchants. The company maintains warehouses that stock items carried by its dot.com clients. When a client receives an order from a customer, the order is forwarded to Logistics Solutions, which pulls the item from storage, packs it, and ships it to the customer. The company uses a predetermined variable overhead rate based on direct labor hours. In the most recent month, 145,000 items were shipped to customers using 5,600 direct laborhours. The company incurred a total of $17,080 in variable overhead costs. According to the company's standards, 0.04 direct laborhours are required to fulfill an order for one item and the variable overhead rate is $3.10 per direct laborhour. Required: 1. According to the standards, what variable overhead cost should have been incurred to fill the orders for the 145,000 items? How much does this differ from the actual variable overhead cost? (Round labor hours per item and overhead cost per hour to 2 decimal places.) Number of items shipped Standard direct laborhours per item Total direct laborhours allowed Standard variable overhead cost per hour Total standard variable overhead cost Actual variable overhead cost incurred Total standard variable overhead cost Total variable overhead variance 2. Break down the difference computed in (1) above into a variable overhead rate variance and a variable overhead efficiency variance. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).) Variable overhead rate variance Variable overhead efficiency variance http://ezto.mheducation.com/hm.tpx 1/2 6/17/2016 Chapter 8 Homework (19) Hints References eBook & Resources Hint #1 Check my work 2016 McGraw-Hill Education. All rights reserved. http://ezto.mheducation.com/hm.tpx 2/2 6/17/2016 Chapter 8 Homework (19) Brewer 7th edition: BUAD162 - Managerial Accounting Summer (1) 2016 Chapter 8 - Homework (1-9) 7. diego merisma instructions | help value: 1.25 points Exercise 8-7 Flexible Budget [LO8-1] Lavage Rapide is a Canadian company that owns and operates a large automatic carwash facility near Montreal. The following table provides data concerning the company's costs: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Fixed Cost Cost per per Month Car Washed $ 0.70 $ 1,200 $ 0.08 $ 0.25 $ 4,800 $ 0.40 $ 8,200 $ 2,000 $ 1,600 $ 0.05 For example, electricity costs are $1,200 per month plus $0.08 per car washed. The company expects to wash 8,100 cars in August and to collect an average of $6.30 per car washed. Required: Complete the company's planning budget for August. Lavage Rapide Planning Budget For the Month Ended August 31 Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense Net operating income References eBook & Resources Worksheet Difficulty: 1 Easy Exercise 87 Flexible Budget [LO81] Learning Objective: 0801 Prepare a flexible budget. http://ezto.mheducation.com/hm.tpx 1/2 6/17/2016 Chapter 8 Homework (19) Check my work 2016 McGraw-Hill Education. All rights reserved. http://ezto.mheducation.com/hm.tpx 2/2 6/17/2016 Chapter 8 Homework (19) Brewer 7th edition: BUAD162 - Managerial Accounting Summer (1) 2016 Chapter 8 - Homework (1-9) 8. diego merisma instructions | help value: 1.25 points Exercise 8-8 Flexible Budget [LO8-1] Lavage Rapide is a Canadian company that owns and operates a large automatic carwash facility near Montreal. The following table provides data concerning the company's costs: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Fixed Cost Cost per per Month Car Washed $ 0.50 $ 1,200 $ 0.06 $ 0.10 $ 4,800 $ 0.40 $ 8,100 $ 1,900 $ 1,500 $ 0.05 For example, electricity costs are $1,200 per month plus $0.06 per car washed. The company actually washed 8,400 cars in August and collected an average of $5.90 per car washed. Required: Complete the company's flexible budget for August. Lavage Rapide Flexible Budget For the Month Ended August 31 Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense Net operating income References Worksheet http://ezto.mheducation.com/hm.tpx eBook & Resources Difficulty: 1 Easy 1/2 6/17/2016 Chapter 8 Homework (19) Exercise 88 Flexible Budget [LO81] Learning Objective: 0801 Prepare a flexible budget. Check my work 2016 McGraw-Hill Education. All rights reserved. http://ezto.mheducation.com/hm.tpx 2/2 6/17/2016 Chapter 8 Homework (19) Brewer 7th edition: BUAD162 - Managerial Accounting Summer (1) 2016 Chapter 8 - Homework (1-9) 9. diego merisma instructions | help value: 1.25 points Exercise 8-9 Prepare a Report Showing Revenue and Spending Variances [LO8-2] Lavage Rapide is a Canadian company that owns and operates a large automatic carwash facility near Montreal. The following table provides data concerning the company's costs: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Fixed Cost Cost per per Month Car Washed $ 0.40 $ 1,200 $ 0.05 $ 0.25 $ 4,500 $ 0.30 $ 8,000 $ 1,900 $ 1,700 $ 0.02 For example, electricity costs are $1,200 per month plus $0.05 per car washed. The company actually washed 8,100 cars in August. The company expected to collect an average of $6.10 per car washed. The actual operating results for August appear below. Lavage Rapide Income Statement For the Month Ended August 31 Actual cars washed 8,100 Revenue $ 49,360 Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense Net operating income 3,710 1,785 2,565 7,730 8,000 1,900 1,942 27,632 $ 21,728 Required: Prepare a report showing the company's revenue and spending variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) http://ezto.mheducation.com/hm.tpx 1/2 6/17/2016 Chapter 8 Homework (19) Lavage Rapide Revenue and Spending Variances For the Month Ended August 31 Revenue Expenses: Cleaning supplies Electricity Maintenance Wages and salaries Depreciation Rent Administrative expenses Total expense Net operating income rev: 12_29_2015_QC_CS36210 References eBook & Resources Worksheet Difficulty: 1 Easy Exercise 89 Prepare a Report Showing Revenue and Spending Variances [LO82] Learning Objective: 0802 Prepare a report showing revenue and spending variances. Check my work 2016 McGraw-Hill Education. All rights reserved. http://ezto.mheducation.com/hm.tpx 2/2