Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct labor-hours and its standard cost card per unit is

Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct labor-hours and its standard cost card per unit is as follows:

Direct material: 5 pounds at $10.00 per pound $ 50.00
Direct labor: 3 hours at $13.00 per hour 39.00
Variable overhead: 3 hours at $4.00 per hour 12.00
Total standard variable cost per unit $ 101.00

The company also established the following cost formulas for its selling expenses:

Fixed Cost per Month Variable Cost per Unit Sold
Advertising $ 390,000
Sales salaries and commissions $ 120,000 $ 10.00
Shipping expenses $ 3.00

The planning budget for March was based on producing and selling 29,000 units. However, during March the company actually produced and sold 34,200 units and incurred the following costs:

a.

Purchased 180,000 pounds of raw materials at a cost of $9.50 per pound. All of this material was used in production.

b. Direct-laborers worked 95,000 hours at a rate of $14.00 per hour.
c. Total variable manufacturing overhead for the month was $390,000.
d.

Total advertising, sales salaries and commissions, and shipping expenses were $392,000, $390,450, and $134,000, respectively.

1. value:

10.00 points Required information

Required:
1. What raw materials cost would be included in the companys flexible budget for March?

2.

What is the materials quantity variance for March?(Input the amount as a positive value.Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.).)

3.

What is the materials price variance for March?(Input the amount as a positive value.Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.).)

4.

If Preble had purchased 189,000 pounds of materials at $10 per pound and used 180,000 pounds in production, what would be the materials quantity variance for March?(Input the amount as a positive value.Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.).)

5.

If Preble had purchased 189,000 pounds of materials at $9.50 per pound and used 180,000 pounds in production, what would be the materials price variance for March?(Input the amount as a positive value.Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.).)

6. What direct labor cost would be included in the companys flexible budget for March?

7.

What is the direct labor efficiency variance for March?(Input the amount as a positive value.Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.).)

8.

What is the direct labor rate variance for March?(Input the amount as a positive value.Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.).)

9.

What variable manufacturing overhead cost would be included in the companys flexible budget for March?

10.

What is the variable overhead efficiency variance for March?(Input the amount as a positive value.Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance.).)

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

Authors: Ronald W Hilton

8th Edition

0073526924, 9780073526928

More Books

Students also viewed these Accounting questions

Question

Which of the following best describes brand promise?

Answered: 1 week ago