Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The Platter Valley factory of Bybee Industries manufactures field boots. The cost of each boot includes direct materials, direct labor, and manufacturing (factory) overhead. The

image text in transcribed
image text in transcribed
The Platter Valley factory of Bybee Industries manufactures field boots. The cost of each boot includes direct materials, direct labor, and manufacturing (factory) overhead. The firm traces all direct costs to products, and it assigns overhead cost to products based on direct labor hours. The company budgeted $10,125 variable factory overhead cost, $90,000 for fixed factory overhead cost and 2,250 direct labor hours (its practical capacity) to manufacture 4,500 pairs of boots in March. The factory used 4,200 direct labor hours in March to manufacture 4,300 pairs of boots and spent $17,300 on variable overhead during the month. The actual fixed overhead cost incurred for the month was $93,500. Required: Compute the factory overhead flexible-budget variance, the factory overhead spending variance, and the efficiency variance fo variable factory overhead for March and state whether each variance is favorable ( F ) or unfavorable (U). 2. Provide the appropriate journal entry to record the variable overhead spending variance and a second entry to record the varia overhead efficiency variance for March. Assume that the company uses a single account, Factory Overhead, to record overhead costs. Complete this question by entering your answers in the tabs below. Compute the factory overhead flexible-budget variance, the factory overhead spending variance, and the efficiency variance for variable factory overhead for March and state whether each variance is favorable (F) or unfavorable (U). The Platter Valley factory of Bybee industries manufactures field boots. The cost of each boot includes direct materials, direct labor, and manufacturing (factory) overhead. The firm traces all direct costs to products, and it assigns overhead cost to products based on direct labor hours. The company budgeted $10,125 variable factory overhead cost, $90,000 for fixed factory overhead cost and 2,250 direct labor hours (its practical capacity) to manufacture 4,500 pairs of boots in March. The factory used 4,200 direct labor hours in March to manufacture 4,300 pairs of boots and spent $17,300 on variable overhead during the month. The actual fixed overhead cost incurred for the month was $93,500. Required: 1. Compute the factory overhead flexible-budget variance, the factory overhead spending variance, and the efficiency variance for variable factory overhead for March and state whether each variance is favorable (F) or unfavorable (U) 2. Provide the appropriate journal entry to record the variable overhead spending variance and a second entry to record the variable overhead efficiency variance for March. Assume that the company uses a single account, Factory Overhead, to record overhead costs. Complete this question by entering your answers in the tabs below. Provide the appropriate journal entry to record the variable overhead spending variance and a second entry to record the variable overhead efficiency variance for March. Assume that the company uses a single account, Foctory Overhead, to record overhead costs. (if no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

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

Financial Accounting A User Perspective

Authors: Robert E. Hoskin, Maureen R. Fizzell, Donald C. Cherry

4th Canadian Edition

0470834455, 978-0470834459

More Books

Students also viewed these Accounting questions

Question

Is this public actively seeking information on this issue?

Answered: 1 week ago

Question

How much loyalty does this public have for your organization?

Answered: 1 week ago

Question

How influential does the organization see this public as being?

Answered: 1 week ago