Requirement 1. Compute the cost and efficiency variances for direct materials and direct labor.
Begin with the cost variances. Select the required formulas, compute the cost variances for direct materials and direct labor, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations used: AC = actual cost; AQ = actual quantity; FOH = fixed overhead; SC = standard cost; SQ = standard quantity.)
Select the required formulas, compute the efficiency variances for direct materials and direct labor, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations used: AC = actual cost; AQ = actual quantity; FOH = fixed overhead; SC = standard cost; SQ = standard quantity.)
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 each variance is favorable (F) or unfavorable (U). (Round any interim calculations to four decimal places, X.XXXX, and your final answers to the nearest whole dolllar. Abbreviations used: AC = actual cost; AQ = actual quantity; FOH = fixed overhead; SC = standard cost; SQ = standard quantity; VOH = variable overhead.)
Requirement 5. intentionally hired more highly skilled workers during . 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 _____
( favorable, unfavorable) direct labor efficiency variance, it _____( does, does not)
appear that these more-skilled workers performed efficiently.
The overall net effect is (
favorable, unfavorable), thus management's decision was _______. ( unwise, wise).
Requirement 1. Compute the cost and efficiency variances for direct materials and direct labor Begin with the cos variances Select the required formulas, compute the cos variancesfor direct materials and direct labor, an ratiance. (Prepare a single compound joumai entye) Iding the related variances (Prepare a single compound joumal entry) overhead cos and efficiency variancesand the fixed overhead cos and volume vanar ect the required fomulas compute the vanable ovethead cost and efficiency vat ances xed ovemead; 8C= tandard cot, 80= sandad quantity. VOH = variable overhead.) Variance Now compute the fixed ovethead cot and volume variances select the reauined fomilas Requirements 1. Compute the cost and efficiency variances for direct materials and direct labor. 2. Journalize the purchase and usage of direct materials and the assignment of direct labor, including the related variances. 3. For manufacturing overhead, compute the variable overhead cost and efficiency variances and the fixed overhead cost and volume variances. 4. Joumalize the actual manufacturing overhead and the allocated manufacturing overhead. Journalize the movement of all production costs from Work-in-Process Inventory. Joumalize the adjusting of the Manufacturing Overhead account. 5. Rouse intentionally hired more highly skilled workers during July. How did this decision affect the cost variances? Overall, was the decision wise? Rouse manufactures coffee mugs thatit sells to other companies for customizing with their own logos Rouse prepares flexible budgets and u ses a standard cost system to control manufactunng costs. The standard unit cost of a coffee mug is based on static bu dget volume of 60,100 coffee mugs per month I Requirement 1 . Compute the cost and efficiency variances for direct materials and direct labor. Begin with the cost variances. Select the required formulas, compute the cost variances for direct materials and direct labor, and identify whether each variance is favorable ( F ) or unfavorable (U). (Abbreviations used: AC= actual cost: AQ= actual quantity; FOH= fixed overhead; SC= standard cost: SQ= standard quantity.) Part 2 Select the required formulas, compute the efficiency variances for direct materials and direct labor, and identify whether each variance is favorable (F) or unfavorable (U). (Abbreviations used: AC= actual cost: AQ= actual quantity; FOH= fixed overhead; SC= standard cost: SQ= standard quantity.) Part 3 Requirement 2. Journalize the purchase and usage of direct materials and the assignment of direct labor, including the related variances. (Record debits first, then credits. Select 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 iournal entry.) More info a. There were no beginning or ending inventory balances. All expenditureswere on account. b. Actual production and saleswere 62,800 coffee mugs c. Actual direct materials usage was 10,000lbs at an actual cos$0o$0.17 per lb. d. Actual direct labor usage was 201,000 minutes at a total cost of $32,160. e. Actual overhead cos was $4,020 variable and $36,480 fixed. f. Selling and administrative costs were $120,000. Requirement 1. Compute the cost and efficiency variancesfor dinct materlals and direct Iabor Begin with the cost vadances Select the require d formul as, compute the cos variancesfor direct materials and direct laboc, and identify whether each variar Formula Variance Direct materials co \& variance = Direct labor cost variance Select the required formulas comy Direct materiais efficiency variance Direct labor efficiency varlance Requirement 2. Joumalize the put Begin by joumalizing the purchase Date aul. Accounts and Accounts and Actual FOH - Budgeted FOH Bugeted FOH - Allocated FOH erials and direct labos and (dentfy whether e ach variance is favorable F ) or un Variance ie assignment of direct labor, including the related variances. Record debits fir variance, Prepare a angle compound joumal entry) redit Requirerrent 3. For manufacturing ovorhead, com pute the variable overhead cos and efficiency variances and the fxed overhead cost and volum Begin with the variable overhead cost and effiency yari ances. Seled the required fornulas, com pute the variable overhead cost and efficiency Abbreviationsused: AC a actual cos; AO= actual quantity, FOH= foxed overhead; SO=1 andard cotSO= tandard quantity, VOH = variable ove Nowcom pute the fixed overhead cost and volum e variances Select the required fom ulas, compute the ixed overhead cost and vime yariances Formula Van ance FOH cot variance = FOH volume variance " y on satic busget voluns of 60,100 cothe mugsper onter. overheod cot and efticiency wariances and the bued ovethead cot and volum evariances ed the requited fom ulas, compute the vwable overhesd cos and efticiency variances, and identify whether ea Varlance Varance. eihead cossinarred Data table Direct Materials (0.2 lbs @ \$0 25 per lb) Direct Labor (3 minutes @ \$0.14 per minute) Manufacturing Overhead: Variable (3 minutes @ \$0.04 per minute) Fixed (3 minutes@ \$ \$0.13 per minute) Total Cost per Coffee Mug $0.05 0.42 $0.12 0.39 $0.98 Actual cost and production information for July 2024 follows: (i) (Click the icon to view actual cost and production information.) Read the requirements. Requirement 1. Compute the cost and efficiency va nances for direct materials and direct labor: Begin with the cos variances Select the required formulas, compute the cot variancesfor direct materials and direct labor, and identify Date Date
