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ACC350 Final Exam

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Question;ACC350, Final Exam;Fruit-n-Berries, Inc., manufactures a product called Fruta. The company uses a standard cost system;and has established the following standards for one (1) unit of Fruta;Standard Quantity;Standard Price or Rate;Standard Cost;Direct materials;1.5 pounds;$6 per pound;$9.00;Direct labor;0.6 hours;$12 per hour;7.20;Variable overhead;0.6 hours;$2.50 per hour;1.50;$17.70;The following;activities were recorded by the company relative to the production of Fruta;The company produced 3,000 units during;the month.A total of 8,000 pounds of material were;purchased at a cost of $46,000.There was no beginning inventory of;materials on hand to start the month, at the end of the month, 3,000 pounds of;material remained in the warehouse unused.The company employs 10 persons to work on;the production of Fruta. During June;each worked an average of 160 hours at an average rate of $12.50 per hour.Variable overhead is assigned to Fruta on a;basis of direct labor hours. Variable;overhead costs during the month totaled $3,600.;If management is;anxious to determine the efficiency of the activities surrounding the;production of Fruta, (1) compute the materials price and quantity variances;(2) compute the labor rate and efficiency variances, (3) compute the variable;overhead spending and efficiency variances, (4) compute the total materials;variance, (5) compute the total labor variance, (6) compute the total variable;overhead variance, (7) compute the total variance and (8) what would you recommend;to management? (120 points);The Good Buy Company produces a single product. The cost characteristics of the product;and of the manufacturing plant are given below;Number of units produced each;year.............. 6,000;Variable costs per unit;Direct materials;$2;Direct labor;$4;Variable manufacturing overhead;$1;Variable selling & administrative;expense;$3;Fixed costs per unit;Manufacturing overhead;$30,000;Selling & administrative expense;$10,000;Under the;variable costing method (1) compute the cost of a unit of product and (2);prepare a variable costing income statement if 5,000 units are sold at a price;of $20. Assume beginning inventory is;equal to zero (0). (30 points);Bernie Company used a regression analysis to predict the annual;cost of indirect materials. The;results are shown below.;What is the cost function for this;analysis? (15 points)What can you surmise about the data used;in this analysis? Please be specific and;concise. (15 points)How many data points were used in this;analysis? (15 points)If the activity level is 33,850, what is;the cost of this activity? (15;points);The Sawaya Hotel?s (Japan) guest-days of occupancy and custodial;supplies expense (in Japanese yen, denoted by ?) over the last seven;months were;Month;Guest-Days;of Occupancy;Custodial;Supplies Expense;March;4,000;?7,500,000;April;6,500;?8,250,000;May;8,000;?10,500,000;June;10,500;?12,000,000;July;12,000;?13,500,000;August;9,000;?10,750,000;September;7,500;?9,750,000;Guest-day is a;measure of the overall activity at the hotel.;For example, a guest who stays at the hotel for three (3) days is;counted as three (3) guest-days. Using;the high-low method, estimate a cost formula for custodial supplies;expense. Using the cost formula you;developed, what amount of custodial supplies expense would you expect to be;incurred at an occupancy level of 11,000 guest-days? (30 points)

 

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