Requirement 9. Prepare the standard cost income statement for 2019. (Use a minus sign or parentheses to enter any contra expenses and/or an operating loss. Enter all other amounts as positive numbers.) Review the flexible budget performance report from Requirement 3. $ 280,000 -214798 Trenton Toy Company Standard Cost Income Statement For the Year Ended December 31, 2019 Net Sales Revenue Cost of Goods Sold at standard cost Manufacturing Cost Variances: Direct Materials Cost Variance -7110 Direct Materials Efficiency Variance 300 Direct Labor Cost Variance -948 Direct Labor Efficiency Variance 200 Variable Overhead Cost Variance 316 Variable Overhead Efficiency Variance 200 Fixed Overhead Cost Variance 2160 Fixed Overhead Volume Variance 192 Total Manufacturing Cost Variances 4,690 Cost of Goods Sold at actual 60512 Choose from any list or enter any number in the input fields and then click Check Answer. Flexible Budget Performance Report 5 Trenton Toy Company Flexible Budget Performance Report For the Year Ended December 31, 2019 - 2 3 (1)-(3) Budget Flexible Amounts Actual Budget Flexible Per Unit Results Budget 4,000 4,000 $ 70.00 $ 280,000 $ 0 $ 280,000 $ 4 (3) - (5) Sales Volume Variance Static Variance Budget Units 3,900 Net Sales Revenue 7,000 F $ 273,000 Variable Costs: Product Costs 62,402 2,800 1,250 U 0 1,250 U 61,152 2,800 Selling and Admin. Costs 6,150 U 70 u 780 F 55,002 2,730 214,798 216,048 215,268 Contribution Margin Fixed Costs: Product Costs 20,688 53,200 2,160 F 0 22,848 53,200 0 0 22,848 53,200 Selling and Admin. Costs $ 140,910 $ 910 $ 140,000 $ $ 139,220 Operating Income Print Done Direct materials cost variance Direct materials efficiency variance Formula (AC - SC) XAQ (AQ - SQ) x SC = $ = $ Variance 7,110U 300 F = Select the formula to calculate direct labor cost and efficiency variances, then enter the variance amounts. (Label each variance as favorable (F) or unfavorable (U).) Formula Variance Direct labor cost variance (AC - SC) XAQ (AQ - SQ) x SC = $ $ 948 200 U F Direct labor efficiency variance Requirement 8. For manufacturing overhead, compute the variable overhead cost and efficiency variances and the fixed overhead cost and volume variances. We will start with the variable overhead (VOH). Select the formula to calculate VOH cost and efficiency variances, then enter the variance amounts. (Label each variance as favorable (F) or unfavorable (U).) Formula VOH cost variance = (AC-SC) XAQ (AQ - SQ) x SC $ $ Variance 316 200 F F VOH efficiency variance Select the formula to calculate the fixed overhead (FOH) cost and volume variances, then enter the variance amounts. (Label each variance as favorable (F) or unfavorable (U).) FOH cost variance = Formula Actual FOH - Budgeted FOH Bugeted FOH - Allocated FOH = $ = $ Variance 2,160 192 F F. FOH volume variance Choose from any list or enter any number in the input fields and then click Check Answer. Data Table - X Trenton Toy Company Balance Sheet December 31, 2018 Assets Current Assets: Cash $ 10,000 Accounts Receivable 55,000 Raw Materials Inventory 900 4,350 Finished Goods Inventory Total Current Assets Property, Plant, and Equipment: $ 70,250 Equipment 199,000 (42,000) 157,000 Less: Accumulated Depreciation $ 227,250 Total Assets Liabilities Current Liabilities: Accounts Payable $ 10,000 Stockholders' Equity $ Common Stock, no par 150,000 67,250 Retained Earnings Print Print Done Done * More Info - X (Unless otherwise noted, assume all of the following events occurred during 2018 and that any balances given are stated as of December 31, 2018.) a. Budgeted sales are 900 sets for the first quarter and expected to increase by 50 sets per quarter. Cash sales are expected to be 30% of total sales, with the remaining 70% of sales on account. Sets are budgeted to sell for $70 per set. b. Finished Goods Inventory on December 31, 2018, consists of 150 sets at $29 each. c. Desired ending Finished Goods Inventory is 30% of the next quarter's sales; first quarter sales for 2020 are expected to be 1,100 sets. FIFO inventory costing method is used. d. Raw Materials Inventory on December 31, 2018, consists of 900 pounds. Direct materials requirement is 6 pounds per set. The cost is $1 per pound. Desired ending Raw Materials Inventory is 10% of the next quarter's direct materials needed for production; desired ending inventory for December 31, 2019, is 900 pounds; indirect materials are insignificant and not considered for budgeting purposes. f. Each set requires 0.40 hours of direct labor; direct labor costs average $10 per hour. g. Variable manufacturing overhead is $4.00 per set. h. Fixed manufacturing overhead includes $5,500 per quarter in depreciation and $212 per quarter for other costs, such as utilities, insurance, and property taxes. Fixed selling and administrative expenses include $9,000 per quarter for salaries; $2,400 per quarter for rent; $900 per quarter for insurance; and $1,000 per quarter for depreciation. j. Variable selling and administrative expenses include supplies at 1% of sales. k. Capital expenditures include $55,000 for new manufacturing equipment, to be purchased and paid for in the first quarter. Cash receipts for sales on account are 50% in the quarter of the sale and 50% in the quarter following the sale; Accounts Receivable balance on December 31, 2018, is expected to be received in the first quarter of 2019; uncollectible accounts are considered insignificant and not considered for budgeting purposes. m. Direct materials purchases are paid 70% in the quarter purchased and 30% in the following quarter; Accounts Payable balance on December 31, 2018, is expected to be paid in the first quarter of 2019. n. Direct labor, manufacturing overhead, and selling and administrative costs are paid in the quarter incurred. Incomo tovarnoncois proiontod at CA 500 nor nuortor and is noid in the quartor incurred Print Done n. Direct labor, manufacturing overhead, and selling and administrative costs are paid in the quarter incurred. o. Income tax expense is projected at $4,500 per quarter and is paid in the quarter incurred. p. Trenton desires to maintain a minimum cash balance of $35,000 and borrows from the local bank as needed in increments of $1,000 at the beginning of the quarter; principal repayments are made at the beginning of the quarter when excess funds are available and in increments of $1,000; interest is 5% per year and paid at the beginning of the quarter based on the amount outstanding from the previous quarter. Requirement 9. Prepare the standard cost income statement for 2019. (Use a minus sign or parentheses to enter any contra expenses and/or an operating loss. Enter all other amounts as positive numbers.) Review the flexible budget performance report from Requirement 3. $ 280,000 -214798 Trenton Toy Company Standard Cost Income Statement For the Year Ended December 31, 2019 Net Sales Revenue Cost of Goods Sold at standard cost Manufacturing Cost Variances: Direct Materials Cost Variance -7110 Direct Materials Efficiency Variance 300 Direct Labor Cost Variance -948 Direct Labor Efficiency Variance 200 Variable Overhead Cost Variance 316 Variable Overhead Efficiency Variance 200 Fixed Overhead Cost Variance 2160 Fixed Overhead Volume Variance 192 Total Manufacturing Cost Variances 4,690 Cost of Goods Sold at actual 60512 Choose from any list or enter any number in the input fields and then click Check Answer. Flexible Budget Performance Report 5 Trenton Toy Company Flexible Budget Performance Report For the Year Ended December 31, 2019 - 2 3 (1)-(3) Budget Flexible Amounts Actual Budget Flexible Per Unit Results Budget 4,000 4,000 $ 70.00 $ 280,000 $ 0 $ 280,000 $ 4 (3) - (5) Sales Volume Variance Static Variance Budget Units 3,900 Net Sales Revenue 7,000 F $ 273,000 Variable Costs: Product Costs 62,402 2,800 1,250 U 0 1,250 U 61,152 2,800 Selling and Admin. Costs 6,150 U 70 u 780 F 55,002 2,730 214,798 216,048 215,268 Contribution Margin Fixed Costs: Product Costs 20,688 53,200 2,160 F 0 22,848 53,200 0 0 22,848 53,200 Selling and Admin. Costs $ 140,910 $ 910 $ 140,000 $ $ 139,220 Operating Income Print Done Direct materials cost variance Direct materials efficiency variance Formula (AC - SC) XAQ (AQ - SQ) x SC = $ = $ Variance 7,110U 300 F = Select the formula to calculate direct labor cost and efficiency variances, then enter the variance amounts. (Label each variance as favorable (F) or unfavorable (U).) Formula Variance Direct labor cost variance (AC - SC) XAQ (AQ - SQ) x SC = $ $ 948 200 U F Direct labor efficiency variance Requirement 8. For manufacturing overhead, compute the variable overhead cost and efficiency variances and the fixed overhead cost and volume variances. We will start with the variable overhead (VOH). Select the formula to calculate VOH cost and efficiency variances, then enter the variance amounts. (Label each variance as favorable (F) or unfavorable (U).) Formula VOH cost variance = (AC-SC) XAQ (AQ - SQ) x SC $ $ Variance 316 200 F F VOH efficiency variance Select the formula to calculate the fixed overhead (FOH) cost and volume variances, then enter the variance amounts. (Label each variance as favorable (F) or unfavorable (U).) FOH cost variance = Formula Actual FOH - Budgeted FOH Bugeted FOH - Allocated FOH = $ = $ Variance 2,160 192 F F. FOH volume variance Choose from any list or enter any number in the input fields and then click Check Answer. Data Table - X Trenton Toy Company Balance Sheet December 31, 2018 Assets Current Assets: Cash $ 10,000 Accounts Receivable 55,000 Raw Materials Inventory 900 4,350 Finished Goods Inventory Total Current Assets Property, Plant, and Equipment: $ 70,250 Equipment 199,000 (42,000) 157,000 Less: Accumulated Depreciation $ 227,250 Total Assets Liabilities Current Liabilities: Accounts Payable $ 10,000 Stockholders' Equity $ Common Stock, no par 150,000 67,250 Retained Earnings Print Print Done Done * More Info - X (Unless otherwise noted, assume all of the following events occurred during 2018 and that any balances given are stated as of December 31, 2018.) a. Budgeted sales are 900 sets for the first quarter and expected to increase by 50 sets per quarter. Cash sales are expected to be 30% of total sales, with the remaining 70% of sales on account. Sets are budgeted to sell for $70 per set. b. Finished Goods Inventory on December 31, 2018, consists of 150 sets at $29 each. c. Desired ending Finished Goods Inventory is 30% of the next quarter's sales; first quarter sales for 2020 are expected to be 1,100 sets. FIFO inventory costing method is used. d. Raw Materials Inventory on December 31, 2018, consists of 900 pounds. Direct materials requirement is 6 pounds per set. The cost is $1 per pound. Desired ending Raw Materials Inventory is 10% of the next quarter's direct materials needed for production; desired ending inventory for December 31, 2019, is 900 pounds; indirect materials are insignificant and not considered for budgeting purposes. f. Each set requires 0.40 hours of direct labor; direct labor costs average $10 per hour. g. Variable manufacturing overhead is $4.00 per set. h. Fixed manufacturing overhead includes $5,500 per quarter in depreciation and $212 per quarter for other costs, such as utilities, insurance, and property taxes. Fixed selling and administrative expenses include $9,000 per quarter for salaries; $2,400 per quarter for rent; $900 per quarter for insurance; and $1,000 per quarter for depreciation. j. Variable selling and administrative expenses include supplies at 1% of sales. k. Capital expenditures include $55,000 for new manufacturing equipment, to be purchased and paid for in the first quarter. Cash receipts for sales on account are 50% in the quarter of the sale and 50% in the quarter following the sale; Accounts Receivable balance on December 31, 2018, is expected to be received in the first quarter of 2019; uncollectible accounts are considered insignificant and not considered for budgeting purposes. m. Direct materials purchases are paid 70% in the quarter purchased and 30% in the following quarter; Accounts Payable balance on December 31, 2018, is expected to be paid in the first quarter of 2019. n. Direct labor, manufacturing overhead, and selling and administrative costs are paid in the quarter incurred. Incomo tovarnoncois proiontod at CA 500 nor nuortor and is noid in the quartor incurred Print Done n. Direct labor, manufacturing overhead, and selling and administrative costs are paid in the quarter incurred. o. Income tax expense is projected at $4,500 per quarter and is paid in the quarter incurred. p. Trenton desires to maintain a minimum cash balance of $35,000 and borrows from the local bank as needed in increments of $1,000 at the beginning of the quarter; principal repayments are made at the beginning of the quarter when excess funds are available and in increments of $1,000; interest is 5% per year and paid at the beginning of the quarter based on the amount outstanding from the previous quarter