Introductin to Managerial Accounting - 25868

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Tami17a

Tami17a

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Price: $20
  • From: Business,
  • Due on: Tue 24 Sep, 2013 (08:46am)
  • Asked on: Tue 24 Sep, 2013
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Description

Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct labor-hours and its standard cost card per unit is as follows:                

Direct Materials: 5 pounds at $8.00 per pound...... $40.00                

Direct Labor: 2 hours at $14.00 per hour ...............28.00                

Variable Overhead: 2 hours at $5.00 per hour ....... 10.00                

Total standard variable cost per unit ....................$78.00                

The company also established the following cost formulas for its selling expenses:                

                

                                                 Fixed Cost  Variable Cost                

Per Month Per Unit Sold                

Advertising .................................$200,000                

Sales salaries and commisions ........$100,000      $12.00                

Shipping expenses ......................................................$3.00                

                

The planning budget for March was based on producing and selling 25,000 units. However, March the compnay actually produced and sold 30,000 units and incurred the following costs:                

a. Purchased 160,000 pounds of raw materials at a cost of $7.50 per pound. All of this material was used in production.                

b. Direct-laborers worked 55,000 hours at a rate of $15.00 per hour.                

c. Total variable manufacturing overhead for the month was $280,500.                

d. Total advertising, sales salaries and commissions, and shipping expenses were $210,000, $455,000, and $115,000, respectively.                

                

Required to Answer:                

1. What raw materials cost would be included in the company's flexible budget for March?                

                

2. What is the materials quantity variance for March?                

                

3. What is the materials price variance for March?                

                

4. If Preble had purchased 170,000 pounds of materials at $7.50 per pound and used 160,000                

pounds in production, what would be the materials quantity variance for March?                

                

5. If Preble had purchased 170,000 pounds of materials at $7.50 per pound and used 160,000                

pounds in production, what would be the materials price variance for March?                

                

6. What direct labor cost would be included in the company's flexiable budget for March?                

                

7. What is the direct labor efficency variance for March?                

                

8. What is the direct labor rate variance for March?                

                

9. What variable manufacturing overhead cost would be included in the company's flexible budget                

for March?                

                

10. What is the variable overhead efficiency variance for March?                

                

11. What is the variable overhead rate variance for March?                

                

12. What amounts of advertising, sales salaries and commisions, and shipping expenses would be                

included in the company's flexible budget for March?                

                

13. What is the spending variance related to advertising?                

                

14. What is the spending variance related to sales salaries and commissions?                

                

15. What is the spending variance related to shipping expenses?

2 Solution for Introductin to Managerial Accounting
Title Price Category solution By purchased  
Preble Company manufactures one product. __Correct w/ Solutions ACCOUNTANT you can trust!!
$15.00 no category rubyCpaMba 0 time(s)
Best solution (Managerial Accounting)
$20.00 no category experttarun 1 time(s)
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