Patel and Sons Inc. uses a standard cost system to apply factory overhead costs to units...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Patel and Sons Inc. uses a standard cost system to apply factory overhead costs to units produced. Practical capacity for the plant is defined as 52,800 machine hours per year, which represents 26,400 units of output. Annual budgeted fixed factory overhead costs are $264,000 and the budgeted variable factory overhead cost rate is $2.90 per unit. Factory overhead costs are applied on the basis of standard machine hours allowed for units produced. Budgeted and actual output for the year was 19,900 units, which took 41,800 machine hours. Actual fixed factory overhead costs for the year amounted to $256,000 while the actual variable overhead cost per unit was $2.80. Brief Exercise 15-16 (Algo) Given this information, what was (a) the fixed overhead... [LO 15-2] Based on the information provided above, what was (a) the fixed overhead spending (budget) variance for the year, and (b) the production volume variance for the year? Indicate whether each variance was favorable (F) or unfavorable (U). (Do not round intermediate calculations. Round final answers to the nearest whole dollar amount.) (a) Spending (budget) variance (b) Production volume variance Patel and Sons Inc. uses a standard cost system to apply factory overhead costs to units produced. Practical capacity for the plant is defined as 52,800 machine hours per year, which represents 26,400 units of output. Annual budgeted fixed factory overhead costs are $264,000 and the budgeted variable factory overhead cost rate is $2.90 per unit. Factory overhead costs are applied on the basis of standard machine hours allowed for units produced. Budgeted and actual output for the year was 19,900 units, which took 41,800 machine hours. Actual fixed factory overhead costs for the year amounted to $256,000 while the actual variable overhead cost per unit was $2.80. Brief Exercise 15-16 (Algo) Given this information, what was (a) the fixed overhead... [LO 15-2] Based on the information provided above, what was (a) the fixed overhead spending (budget) variance for the year, and (b) the production volume variance for the year? Indicate whether each variance was favorable (F) or unfavorable (U). (Do not round intermediate calculations. Round final answers to the nearest whole dollar amount.) (a) Spending (budget) variance (b) Production volume variance
Expert Answer:
Answer rating: 100% (QA)
a The fixed overhead spending budget variance for the year can be calculated as follows Fixed Ove... View the full answer
Related Book For
Cost management a strategic approach
ISBN: 978-0073526942
5th edition
Authors: Edward J. Blocher, David E. Stout, Gary Cokins
Posted Date:
Students also viewed these accounting questions
-
Patel and Sons Inc. uses a standard cost system to apply factory overhead costs to units produced. Practical capacity for the plant is defined as 55,200 machine hours per year, which represents...
-
Patel and Sons Inc. uses a standard cost system to apply factory overhead costs to units produced. Practical capacity for the plant is defined as 52,200 machine hours per year, which represents...
-
"If nominal GDP rises, velocity must rise." Is this statement true, false, or uncertain? Explain your answer.
-
Sue is 30 years old and is president and a 51% shareholder of C Corporation. She informs you that C Corporation has ten shareholders, all unrelated. Other than herself, no shareholder owns more than...
-
This experiment has two mutually exclusive events, \(A\) and \(\bar{A}\), that form a partition of the sample space \(S\). The number of elements in each set is shown in each region. Find the...
-
Suppose that instead of choosing Earth and the ball as our system in the discussion leading up to Eq. 7.21, we had chosen to consider just the ball. Does it make sense to speak about the...
-
Hector P. Wastrel, a careless employee, left some combustible materials near an open flame in Salter Companys plant. The resulting explosion and fire destroyed the entire plant and administrative...
-
1 Define Management? 2 Define Leadership? 234 4 Explain the Qualities of a successful leader? Define transformational leadership? 5 Explain about Decision making process? Explain the types of...
-
Winsstonco is considering investing in three projects. If we fully invest in a project, the realized cash flows (in millions of dollars) will be as shown it Table 44. For example, project 1 requires...
-
Operating income for Division A is $520,000, total service department charges are $480,000, and operating expenses are $3,200,000. What are the revenues for Division A?
-
Villanueva Corp. had 200,000 shares of common stock, 20,000 shares of convertible preferred stock, and $1,000,000 of 5% convertible bonds outstanding during 2020. The preferred stock is convertible...
-
How do advanced cost-benefit analysis frameworks and probabilistic decision-making models guide strategic resource allocation decisions, balancing short-term efficiency gains with long-term...
-
On June 1, 20Y2, Herbal Co. received $47,150 for the rent of land for 12 months. Journalize the adjusting entry required for unearned rent on December 31, 20Y2. Round your answers to the nearest...
-
NEGOTIATION 1.There is a client complaining about the product they have received. Your customer told you "The item that you send to me has a lot of damages and it is not what I ordered!"Now, the...
-
Should Reparations in the form of money damages to be paid to descendants of African Slaves in the United States? Take a Position Pro or Con
-
Michelles trust is subject to 3.8% surtax on the lesser of the trusts net investment income or the excess of the trusts adjusted gross income over the $12,400 threshold (the highest trust tax rate)....
-
When you were looking at goodwill in the previous chapter, you were interested in the difference between the amount received and the value of net assets. Why do we consider only the assets when there...
-
Fitch and Wall have been in partnership for many years sharing profits and losses in the ratio 5:3 respectively. The following was their statement of financial position as at 31 December 2016: On 1...
-
Alan, Bob and Charles are in partnership sharing profits and losses in the ratio 3:2:1 respectively. The statement of financial position for the partnership as at 30 June 2016 is as follows: Charles...
Study smarter with the SolutionInn App