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Able Company

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1. Able Company manufactures tables for schools. The 2015 operating budget is based on sales of 44,000 units at $55 per table. Operating income is anticipated to be $132,000. Budgeted variable costs are $35 per unit, while fixed costs total $660,000.;Actual income for 2015 was a surprising $477,000 on actual sales of 46,000 units at $57 each. Actual variable costs were $33 per unit and fixed costs totaled $627,000.;Required;Prepare a variance analysis report with both flexible-budget and sales-volume variances.;2. The following data for the Campbell Company pertains to the production of 2,000 garden spades during March. The spade consists of a wooden handle and a metal forged tool that comes in contact with the ground.;Direct Materials (all materials purchased were used);Standard cost: $1.00 per handle and $3.00 per metal tool.;Total actual cost: $9,000.;Materials flexible-budget efficiency variance was $500 unfavorable.;Direct Manufacturing Labor;Standard cost is 5 garden spades per hour at $20.00 per hour.;Actual cost per hour was $21.00.;Labor efficiency variance was $500 favorable.;Required;a. What is the standard direct material amount per garden spade?;b. What is the standard cost allowed for all units produced?;c. What is the total direct materials flexible-budget variance?;d. What is the direct material flexible-budget price variance?;e. What is the total actual cost of direct manufacturing labor?;f. What is the labor price variance for direct manufacturing labor?;3. Delk Company makes separate journal entries for all cost accounting-related activities. It uses a standard cost system for all manufacturing items. For the month of June, the following activities have taken place;Direct Manufacturing Materials Purchased $300,000;Direct Manufacturing Materials Used 250,000;Direct Materials Price Variance 10,000 unfavorable;(at time of purchase);Direct Materials Efficiency Variance 15,000 favorable;Direct Manufacturing Labor Price Variance 6,000 favorable;Direct Manufacturing Labor Efficiency Variance 4,000 favorable;Direct Manufacturing Labor Payable 170,000;Required;Record the necessary journal entries to close the accounts for the month.;4. Evans Inc. manufactures pillows. The 2015 operating budget is based on production of 25,000 pillows with 0.75 machine-hour allowed per pillow. Budgeted variable overhead per hour was $25.;Actual production for 2015 was 27,000 pillows using 19,050 machine-hours. Actual variable costs were $23 per machine-hour.;Required;Calculate the variable overhead spending and efficiency variances.;5. Farmer Inc. makes clocks. The fixed overhead costs for 2015 total $880,000. The company uses direct labor-hours for fixed overhead allocation and anticipates 220,000 hours during the year for 330,000 units. An equal number of units are budgeted for each month.;During June, 32,000 clocks were produced and $72,000 was spent on fixed overhead.;Required;a. Determine the fixed overhead rate for 2015 based on units of input.;b. Determine the fixed overhead static-budget variance for June.;c. Determine the production-volume overhead variance for June.;6. Green has budgeted construction overhead for August of $260,000 for variable costs and $435,000 for fixed costs. Actual costs for the month totaled $275,000 for variable and $445,000 for fixed. Allocated fixed overhead totaled $440,000. The company tracks each item in an overhead control account before allocations are made to individual jobs. Spending variances for August were $10,000 unfavorable for variable and $10,000 unfavorable for fixed. The production-volume overhead variance was $5,000 favorable.;Required;a. Make journal entries for the actual costs incurred.;b. Make journal entries to record the variances for August.

 

Paper#73624 | Written in 18-Jul-2015

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