Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

using selected information from the answers above, prepare journal entries for the following (omit dates) isolating variances where appropriate a) the purchase of the direct

using selected information from the answers above, prepare journal entries for the following (omit dates) isolating variances where appropriate

a) the purchase of the direct material (assume on account)

b) the issurance of direct materials to production

c) the incurrence of actual variable manufacturing overhead costs and actual fixed manufacturing overhead.

1)Direct material Price variance =AQ (AP-SP) = 194,040 (8.80 - 8.50) = 58,212 (unfavourable)

DM Eff. Variance= SP (AQ-SQ) = 8.50 (194,040 - 196,000) = -16,660 (Favourable)

2)Direct Labour Variance= AQ (AR-SR) = 69,200 (21 - 21) = 0

Direct Labour Efficiency Variance= SR (AQ-SQ) = 21 (69,200 - 70,000) = -16,800 (favourable)

3)Overheard

Actual variable overhead cost per unit of cost allocation base = 401,360 / 69,200 = 5.80

Actual fixed overhead cost = 435,960

Budgeted fix overhead cost = 432,000

a.Variance material overhead spending variance =(6-5.80) x 69,200 = 13,840 (favourable)

Variance material overhead efficiency variance= (69,200 - 70,000) x 6 = -4,800 (favourable)

b.Fixed overhead spending= 432,000 - 432,960 = -960 (unfavourable)

Fixed volume variance= [72,000 - (2.5 x 28,000)] x 6 = 12,000 (favourable)

image text in transcribed Becker Co. produces and sells a single product. The standard cost card for the product is stated below: Standard Cost Card - Per Unit Direct Materials, 7 Yards at $8.50 per Yard $59.50 Direct Labour. 2.5 Direct Labour-Hrs. at $21 per Direct Labour-Hr. $52.50 Variable Overhead, 2.5 Direct Labour-Hrs. at $6 per Direct Lab-Hr. $15.00 Fixed Overhead, 2.5 Direct Labour-Hrs. at $6 per Direct Labour-Hr. $15.00 Standard Cost Per Unit 5 l 42.00 The following additional information is available for the year just completed: a. - The company manufactured 28,000 units of product during the year. b. - A total of [94,040 yards of material was purchased during the year at a cost of $8.80 per yard. All of this material was used to manufacture the 28.000 units. There were no beginning or ending inventories for the year. c. - The company worked 69.200 direct labour-hours during the year at a total cost of $ 1 .453.200. (1. - Overhead cost is applied to products on the basis of direct labour-hours. Data related to manufacturing overhead costs follow

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

Accounting What The Numbers Mean

Authors: David Marshall, Wayne McManus, Daniel Viele

10th Edition

77729870, 9780077729875

More Books

Students also viewed these Accounting questions

Question

Describe how childhood experiences affect self-esteem.

Answered: 1 week ago

Question

3. To retrieve information from memory.

Answered: 1 week ago

Question

2. Value-oriented information and

Answered: 1 week ago

Question

1. Empirical or factual information,

Answered: 1 week ago