It had been a whirlwind of a year for Dexter Corporation, with things happening so quickly...

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It had been a whirlwind of a year for Dexter Corporation, with things happening so quickly that management hadn't had time to update inventory balances or the amount of gross margin generated on its products. Needless to say, it was time someone evaluated company progress. The accounting team gathered the following information. Standard Price $4.00 per pound $14.00 per DL hour DM DL Variable-MOH Fixed-MOH Standard Quantity per Unit 3.0 pounds 1.2 DL hours 2.0 machine hours 2.0 machine hours Other key budgeted and actual information: • Actual units produced: 25,300. • Actual DM quantity purchased: 79,000 pounds at $4.10 per pound. • Actual DM quantity used: 75,000 pounds. • Actual DL hours used: 31,200 hours at $14.25 per hour. . Actual machine hours uled: 48,800. $3.50 per machine hour $6.80 per machine hour • Actual variable-MOH cost was $166,300; budgeted variable-MOH cost was $161,000. • Actual fixed-MOH cost was $320,000; budgeted fixed-MOH cost was $312,800. Required a. Conduct a complete variance analysis for all four main product costs (DM, DL, variable-MOH price and efficiency variances, and fixed-MOH price and volume variances). Specify the amount and sign of each variance. b. Record journal entries for the following transactions using standard costing. 1. The purchase of DM on account. 2. The transfer of DM into production. 3. The accrual of DL cost. 4. Actual MOH cost incurred as follows. • Variable-MOH costs included $100,000 of accrued indirect labor and $66,300 of accrued utility cost. • Fixed-MOH costs included $200,000 of depreciation on plant assets and $120,000 of accrued supervisor salaries It had been a whirlwind of a year for Dexter Corporation, with things happening so quickly that management hadn't had time to update inventory balances or the amount of gross margin generated on its products. Needless to say, it was time someone evaluated company progress. The accounting team gathered the following information. Standard Price $4.00 per pound $14.00 per DL hour DM DL Variable-MOH Fixed-MOH Standard Quantity per Unit 3.0 pounds 1.2 DL hours 2.0 machine hours 2.0 machine hours Other key budgeted and actual information: • Actual units produced: 25,300. • Actual DM quantity purchased: 79,000 pounds at $4.10 per pound. • Actual DM quantity used: 75,000 pounds. • Actual DL hours used: 31,200 hours at $14.25 per hour. . Actual machine hours uled: 48,800. $3.50 per machine hour $6.80 per machine hour • Actual variable-MOH cost was $166,300; budgeted variable-MOH cost was $161,000. • Actual fixed-MOH cost was $320,000; budgeted fixed-MOH cost was $312,800. Required a. Conduct a complete variance analysis for all four main product costs (DM, DL, variable-MOH price and efficiency variances, and fixed-MOH price and volume variances). Specify the amount and sign of each variance. b. Record journal entries for the following transactions using standard costing. 1. The purchase of DM on account. 2. The transfer of DM into production. 3. The accrual of DL cost. 4. Actual MOH cost incurred as follows. • Variable-MOH costs included $100,000 of accrued indirect labor and $66,300 of accrued utility cost. • Fixed-MOH costs included $200,000 of depreciation on plant assets and $120,000 of accrued supervisor salaries

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a Variance Analysis 1 Direct Material DM Variances DM Price Variance Actual Price Standard Price x Actual Quantity Purchased DM Price Variance 410 400 ... View the full answer