The first CH 6 take home exam: You have a business manufacturing snarky hats for TicTok wannabes. You produce these hats in batches of 100. Each hat has the following manufacturing standards (i.e., budgets): There is no beginning or ending inventory for WIP and Finished Goods. You have sufficient beginning direct material inventory of material that you do not need to purchase any during the month. During March 2023 you made 11 batches of hats (100 hats in each batch) and spent/used/incurred the following: R a) Prepare an analysis of actual direct production costs for March compared to Budget-adjusted-for-output (Flex Budget). Identify the usage/efficiency, price/rate, and production volume variances. b) If you close all of the variances to COGS, what will be the net change in COGS? c) Ferd is responsible for buying your direct materials. Did he do a "good" job in March? Why? d) Franny is in charge of the use of the direct materials. Did she do a "good" job in March with regards to material usage? Why? e) Floosy is in charge of the use of direct labor. Did she do a "good" job in March with regards to labor usage/efficiency? Why? f) Futz sets hourly wage rates for the direct labor. Did he do a "good" job in March? Why? g) Noxon is responsible for spending on both variable and fixed overhead. Did he do a good job in March? See the attached solution to the above. Part 2 Prepare the joumal entries to record the activities discussed above: - Record the use of direct materials with price and usage variances - Record the incurrence of direct labor with rate and efficiency variances - Record the incurrence of variable and fixed overhead with spending, efficiency, and production volume variances - Record the transfer of COGM to FG Imventory - Record the transfer of goods sold from FG Inventory to COGS - Close all variances to COGS Post these entries to T-accounts and come to ending balances: - Assume all overhead spending comes from cash - Remember that there is no beginning or ending inventory for WIP and FG