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. Journalize the actual manufacturing overhead and the allocated manufacturing overhead. Journalize the movement of all production costs from Work-in-Process Inventory. Journalize the adjusting of the Manufacturing Overhead account. 5. Preston intentionally hired more highly skilled workers during July. How did this decision affect the cost variances? Overall, was the decision wise? $ 0.05 0.30 Direct Materials (0.2 lbs @ $0.25 per lb) Direct Labor (3 minutes @ $0.10 per minute) Manufacturing Overhead: Variable (3 minutes @ $0.06 per minute) Fixed (3 minutes @ $0.15 per minute) $ 0.18 0.45 0.63 $ 0.98 Total Cost per Coffee Mug Preston manufactures coffee mugs that it sells to other companies for customering with their own logos Preston prepares flexible budgets and uses a standard cost system to control manutacturing costs. The standard unit cost of a coffee mug is based on stabic budget volume of 60.000 coffee mugs per month Click the icon to view the cost data) Actual cost and production information for July 2016 low Click the icon to view actual cast and production Information Read the recent Requirement 1. Compute the cost and effonnay varianons for Grect materials and direct labor Begin with the cont variances Select the required formulas, compute the cost variances for direct materials and direct labor, and identify whether each variance in favorable For utovertin (UIA AC actual con actual quantity, FOHFxed overhead, 90 standard cout, so standard quantity) Formula Variance Direct materials cost variance Direct labor cost variance Preston manufactures coffee mugs that it sells to other companies for customizing with their own logos, Preston 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 60,000 coffee mugs per month (Click the icon to view the cost data) Actual cost and production information for July 2018 follows: (Click the icon to view actual cost and production information) Read the requirements 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, so standard quantity) Formula Variance Direct materials cost variance Direct labor cost variance = 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. Journalize the actual manufacturing overhead and the allocated manufacturing overhead. Journalize the movement of all production costs from Work-in-Process Inventory. Journalize the adjusting of the Manufacturing Overhead account. 5. Preston intentionally hired more highly skilled workers during July. How did this decision affect the cost variances? Overall, was the decision wise? UUUUUUU Data Table - x 8 follow Lion info $ 0.05 0.30 Direct Materials (0.2 lbs @ $0.25 per lb) Direct Labor (3 minutes @ $0.10 per minute) Manufacturing Overhead: Variable (3 minutes @ $0.06 per minute) Fixed (3 minutes @ $0.15 per minute) $ 0.18 0.45 0.63 Whether SQ = sta $ Total Cost per Coffee Mug 0.98 Print Done any number in the input fields and then click Check Answer. CH DemoDocs Example Clear All Get More Help 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. Journalize the actual manufacturing overhead and the allocated manufacturing overhead. Journalize the movement of all production costs from Work-in-Process Inventory. Journalize the adjusting of the Manufacturing Overhead account. 5. Preston intentionally hired more highly skilled workers during July. How did this decision affect the cost variances? Overall, was the decision wise? Print Done