ACC 349 Entire Course

ACC 349 Entire Course

COST ACCOUNTINGThe Latest Version A+ Study Guide

 

ACC 349 Week 1 Connect Assignment
 

Access Connect.

Complete the Week 1 Problems

1.

 

Which of the following are forms of detective internal control?

Relating data sets to one another to identify and resolve discrepancies.

Comparing actual performance to various benchmarks to identify unexpected results.

Maintaining written and/or electronic evidence to support transactions.

Putting passwords on a computer to restrict access.

 

 

 

2.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The following cost and inventory data are taken from the accounting records of Mason Company for the year just completed:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 
 
  Costs incurred:
 
 
    Direct labor cost
$
81,000
    Purchases of raw materials
$
138,000
    Manufacturing overhead
$
210,000
    Advertising expense
$
45,000
    Sales salaries
$
101,000
    Depreciation, office equipment
$
224,000
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
Beginning 

of the Year
End of 

the Year
  Inventories:
 
 
 
 
 
 
    Raw materials
$
8,800
 
$
10,500
 
    Work in process
$
5,700
 
$
20,700
 
    Finished goods
$
71,000
 
$
25,900
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1.
Prepare a schedule of cost of goods manufactured.
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2.
Prepare the cost of goods sold section of Mason Company’s income statement for the year.
 

 

 

 

 

 

3.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Arden Company reported the following costs and expenses for the most recent month:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 
 
 
  Direct materials
$
75,000
 
  Direct labor
$
37,000
 
  Manufacturing overhead
$
15,000
 
  Selling expenses
$
18,000
 
  Administrative expenses
$
30,000
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1.
What is the total amount of product costs?
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2.
What is the total amount of period costs?
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3.
What is the total amount of conversion costs?
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4.
What is the total amount of prime costs?
 

 

 

 

 

 

4.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mickley Company’s predetermined overhead rate is $23.00 per direct labor-hour and its direct labor wage rate is $13.00 per hour. The following information pertains to Job A-500:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 
  Direct materials
$210
  Direct labor
$130
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1.
What is the total manufacturing cost assigned to Job A-500?
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2.
If Job A-500 consists of 70 units, what is the average cost assigned to each unit included in the job?
 

 

 

 

 

 

5.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Helix Corporation produces prefabricated flooring in a series of steps carried out in production departments. All of the material that is used in the first production department is added at the beginning of processing in that department. Data for May for the first production department follow:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 
Percent Complete
 
Units
Materials
Conversion
  Work in process inventory, May 1
55,000
75
%
 
40
%
 
  Work in process inventory, May 31
35,000
50
%
 
25
%
 
 
 
 
 
 
 
 
 
  Materials cost in work in process inventory, May 1
 
 
 
$
47,100
 
 
  Conversion cost in work in process inventory, May 1
 
 
 
$
12,900
 
 
  Units started into production
 
 
 
 
247,500
 
 
  Units transferred to the next production department
 
 
 
 
267,500
 
 
  Materials cost added during May
 
 
 
$
320,550
 
 
  Conversion cost added during May
 
 
 
$
186,000
 
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1.
Assume that the company uses the weighted-average method of accounting for units and costs. Determine the equivalent units for May for the first process.
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2.
Compute the costs per equivalent unit for May for the first process. (Round your answers to 2 decimal places.)
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3.
Determine the total cost of ending work in process inventory and the total cost of units transferred to the next process in May. (Round your intermediate calculations to 2 decimal places.)
 

 

 

 

6.

Managerial Accounting helps managers perform

Planning

Controlling

Decision-making

All of the above

 

 

 

 

 

7.

Financial accounting focuses on decisions affecting the future.

True

False

 

 

 

8.

The IMA Statement of Ethical Professional Practice standards include all of the following EXCEPT:

Honesty

Credibility

Confidence

Competence

 

 

 
 

 

 

 

ACC 349 Week 2 Connect Assignment
 

Access Connect.

Complete the Week 2 Problems.

1.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Hartford Symphony Guild is planning its annual dinner-dance. The dinner-dance committee has assembled the following expected costs for the event:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 
  Dinner (per person)
$7
  Favors and program (per person)
$4
  Band
$300
  Rental of ballroom
$1,700
  Professional entertainment during intermission
$4,000
  Tickets and advertising
$600
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The committee members would like to charge $33 per person for the evening’s activities.
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
1.
Compute the break-even point for the dinner-dance (in terms of the number of persons who must attend).
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2.
Assume that last year only 250 persons attended the dinner-dance. If the same number attend this year, what price per ticket must be charged in order to break even? (Round your answer to 2 decimal places.)
 
 
 

 

 

2.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Walsh Company manufactures and sells one product. The following information pertains to each of the company’s first two years of operations:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 
 
  Variable costs per unit:
 
 
    Manufacturing:
 
 
        Direct materials
 
$ 21
        Direct labor
 
$ 11
        Variable manufacturing overhead
 
$ 3
    Variable selling and administrative
 
$ 2
  Fixed costs per year:
 
 
    Fixed manufacturing overhead
$
320,000
    Fixed selling and administrative expenses
$
90,000
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

During its first year of operations, Walsh produced 50,000 units and sold 40,000 units. During its second year of operations, it produced 40,000 units and sold 50,000 units. The selling price of the company’s product is $57 per unit.
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
1.
Assume the company uses variable costing:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

a.
Compute the unit product cost for year 1 and year 2.
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

b.
Prepare an income statement for year 1 and year 2.
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2.
Assume the company uses absorption costing:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

a.
Compute the unit product cost for year 1 and year 2. (Round your answer to 2 decimal places.)
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

b.
Prepare an income statement for year 1 and year 2. (Round your intermediate calculations to 2 decimal places)
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3.
Reconcile the difference between variable costing and absorption costing net operating income in year 1 and year 2.
 
 
 

 

 

 

 

3.

Award: 6 out of 6.00 points

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Barlow Company manufactures three products: A, B, and C. The selling price, variable costs, and contribution margin for one unit of each product follow:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
Product
 
A
 
B
 
C
  Selling price
$
240
 
 
$
350
 
 
$
300
 
 
 
 
 
 
 
 
 
 
 
 
 
  Variable expenses:
 
 
 
 
 
 
 
 
 
 
 
    Direct materials
 
32
 
 
 
80
 
 
 
40
 
    Other variable expenses
 
136
 
 
 
130
 
 
 
185
 
 
 
 
 
 
 
 
 
 
 
 
 
  Total variable expenses
 
168
 
 
 
210
 
 
 
225
 
 
 
 
 
 
 
 
 
 
 
 
 
  Contribution margin
$
72
 
 
$
140
 
 
$
75
 
 
 
 
 
 
 
 
 
 
 
 
 
  Contribution margin ratio
 
30
%
 
 
40
%
 
 
25
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The same raw material is used in all three products. Barlow Company has only 4,000 pounds of raw material on hand and will not be able to obtain any more of it for several weeks due to a strike in its supplier’s plant. Management is trying to decide which product(s) to concentrate on next week in filling its backlog of orders. The material costs $8 per pound.
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1.
Compute the amount of contribution margin that will be obtained per pound of material used in each product.
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2a.
Compute the amount of contribution margin on each product.
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2b.
Which orders would you recommend that the company work on next week—the orders for product A, product B, or product C?
 
 
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3.
A foreign supplier could furnish Barlow with additional stocks of the raw material at a substantial premium over the usual price. If there is unfilled demand for all three products, what is the highest price that Barlow Company should be willing to pay for an additional pound of materials?
 
 
 

 

 

 

4.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Imperial Jewelers is considering a special order for 11 handcrafted gold bracelets to be given as gifts to members of a wedding party. The normal selling price of a gold bracelet is $401.00 and its unit product cost is $268.00 as shown below:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 
 
  Direct materials
$
143
  Direct labor
 
85
  Manufacturing overhead
 
40
 
 
 
  Unit product cost
$
268
 
 
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Most of the manufacturing overhead is fixed and unaffected by variations in how much jewelry is produced in any given period. However, $7 of the overhead is variable with respect   to the number of bracelets produced. The customer who is interested in the special bracelet order would like special filigree applied to the bracelets. This filigree would require additional materials costing $6 per bracelet and would also require acquisition of a special tool costing $466 that would have no other use once the special order is completed. This order would have no effect on the company’s regular sales and the order could be fulfilled using the company’s existing capacity without affecting any other order.
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

What effect would accepting this order have on the company’s net operating income if a special price of $361.00 per bracelet is offered for this order? (Enter all amounts as positive values.)
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Should the special order be accepted at this price?
 

 

 

 

ACC 349 Week 3 Team Assignment, Part 1
 

Read the following scenario below:

Leighton Beridon owns “Jeemp Farms”, located near Weimar, TX. The farm produces pecan trees and sod. He has so many orders from the Houston metropolitan area that he is able to sell all his inventory each year, but he is not netting as much as he has in past years. His daughter, Liesl Beridon, came home from college over Thanksgiving and mentioned ABC costing, which she learned about in her cost accounting class. Mr. Beridon does not really know what ABC costing is and is skeptical as to whether it would be right for his business. He has hired your company to educate him about ABC and whether or not he should use an ABC system. Over the next few weeks, you will work towards helping Mr. Beridon decide what is the best route for his company to take.

Shortly after you get started, Mr. Beridon sends you an email stating that he feels he needs to discontinue the sod portion of his business and focus on his tree sector, as he can charge more per tree than he can charge for a foot of sod. He sends you an email stating, “I can charge so much more for a tree than a foot of grass. Therefore, I am planning on discontinuing the sod portion of the business immediately as I make so much more on the trees! I am going to plant all my sod acres with trees”.

Write a 700- to 1,050-word paper plan for your boss explaining how you will analyze Jeemp Farms.

Include the following:

 

 

 

Prepare an argument convincing him to hold off on his decision and see the results of your analysis first. As you have not had time to do any analysis yet, you need to convince Mr. Beridon to wait on whether to discontinue his sod business.
 

 

Project potential benefits Mr. Beridon could gain from using an ABC system.
 

 

Explain how ABC creates these benefits.
 

 

 

Your team is planning on conducting an analysis of whether ABC would be beneficial to Mr. Beridon. Create a process for conducting this analysis.

Include the following:

 

 

 

How could you apply the data in the company’s general ledger?
 

 

Determine questions to ask Mr. Beridon.
 

 

Determine other information to gather.
 

 

Explain how this additional information could help you in your analysis?
 

 

Explain how you would decide on a final recommendation.
 

 

 

Format your assignment to APA standards.

Click the Assignment Files tab to submit as a Microsoft® Word document.

 

 

ACC 349 Week 3 Connect Assignment
 

Access Connect.

Complete the Week 3 Problems.

1.

Award: 20 out of 20.00 points

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lehner Corporation has provided the following data from its activity-based costing accounting system:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Indirect factory wages
$614,000
  Factory equipment depreciation
$350,000
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Distribution of Resource Consumption across Activity Cost Pools:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Activity Cost Pools
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
Customer 

Orders
Product 

Processing
Other
Total
  Indirect factory wages
60%
30%
10%
100%
  Factory equipment depreciation
45%
50%
5%
100%
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The “Other” activity cost pool consists of the costs of idle capacity and organization-sustaining costs that are not assigned to products.
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

How much indirect factory wages and factory equipment depreciation cost would NOT be assigned to products using the activity-based costing system?
 

$350,000

$614,000

$0

$78,900

 

 

 

 

2.

Award: 40 out of 40.00 points

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Worley Company buys surgical supplies from a variety of manufacturers and then resells and delivers these supplies to hundreds of hospitals. Worley sets its prices for all hospitals by marking up its cost of goods sold to those hospitals by 6%. For example, if a hospital buys supplies from Worley that had cost Worley $100 to buy from manufacturers, Worley would charge the hospital $106 to purchase these supplies.
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     For years, Worley believed that the 6% markup covered its selling and administrative expenses and provided a reasonable profit. However, in the face of declining profits Worley decided to implement an activity-based costing system to help improve its understanding of customer profitability. The company broke its selling and administrative expenses into five activities as shown below:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Activity Cost Pool (Activity Measure)
Total Cost
Total Activity
  Customer deliveries (Number of deliveries)
$
486,000
6,000
 deliveries
  Manual order processing (Number of manual orders)
 
684,000
9,000
 orders
  Electronic order processing (Number of electronic orders)
 
288,000
12,000
 orders
  Line item picking (Number of line items picked)
 
559,000
430,000
 line items
  Other organization-sustaining costs (None)
 
660,000
 
 
 
 
 
 
 
  Total selling and administrative expenses
$
2,677,000
 
 
 
 
 
 
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  Worley gathered the data below for two of the many hospitals that it serves—University and Memorial (both hospitals purchased a total quantity of medical supplies that had cost Worley $40,000 to buy from its manufacturers):
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
Activity
  Activity Measure
University
Memorial
  Number of deliveries
13
25
  Number of manual orders
0
48
  Number of electronic orders
19
0
  Number of line items picked
160
210
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
1.
Compute the total revenue that Worley would receive from University and Memorial.
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2.
Compute the activity rate for each activity cost pool. (Round your answers to 2 decimal places.)
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3.
Compute the total activity costs that would be assigned to University and Memorial. (Round your intermediate calculations and final answers to 2 decimal places.)
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4.
Compute Worley’s customer margin for University and Memorial. (Hint: Do not overlook the $40,000 cost of goods sold that Worley incurred serving each hospital.) (Loss amount should be indicated with a minus sign. Round your intermediate calculations and final answers to 2 decimal places.)
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 

Garrison 15e Recheck 2015-01-16

3.

Award: 20 out of 20.00 points

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SecuriCorp operates a fleet of armored cars that make scheduled pickups and deliveries in the Los Angeles area. The company is implementing an activity-based costing system that has four activity cost pools: Travel, Pickup and Delivery, Customer Service, and Other. The activity measures are miles for the Travel cost pool, number of pickups and deliveries for the Pickup and Delivery cost pool, and number of customers for the Customer Service cost pool. The Other cost pool has no activity measure because it is an organization-sustaining activity. The following costs will be assigned using the activity-based costing system:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 
  Driver and guard wages
$
1,180,000
  Vehicle operating expense
 
610,000
  Vehicle depreciation
 
490,000
  Customer representative salaries and expenses
 
520,000
  Office expenses
 
380,000
  Administrative expenses
 
680,000
 
 
 
  Total cost
$
3,860,000
 
 
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The distribution of resource consumption across the activity cost pools is as follows:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
Travel
Pickup 

and

Delivery
Customer 

Service
Other
Totals
  Driver and guard wages
50
%
35
%
10
%
5
%
100
%
  Vehicle operating expense
70
%
5
%
0
%
25
%
100
%
  Vehicle depreciation
60
%
15
%
0
%
25
%
100
%
  Customer representative salaries and expenses
0
%
0
%
90
%
10
%
100
%
  Office expenses
0
%
20
%
30
%
50
%
100
%
  Administrative expenses
0
%
5
%
60
%
35
%
100
%
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
Complete the first stage allocations of costs to activity cost pools.
 
 

 

4.

Award: 10 out of 10.00 points

 

 

In activity-based costing, nonmanufacturing costs are not assigned to products.

True

False

 

 

 

5.

Award: 10 out of 10.00 points

 

 

Which of the following would probably be the most accurate measure of activity to use for allocating the costs associated with a factory’s purchasing department?

Machine-hours

Direct labor-hours

Number of orders processed

Cost of materials purchased

 

 

 

 

 

ACC 349 Week 4 Team Assignment, Part 2
 

Resource: Jeemp Template.

Mr. Beridon received your requests for information and returned data which you have compiled in an Microsoft® Excel® spreadsheet (see document template). He also said, “We grow sod and trees at Jeemp Farms. We sell the sod mainly to home builders in the area, although we sell to some individuals who are purchasing square footages to re-sod their yard. Many home builders will purchase to sod an entire subdivision. They then may come back to us to purchase trees for the yards. It really is a package deal. For builders like that, we are a one-stop-shop.  In most cases, however, we sell the trees to orchards and some individuals. The purchaser is responsible for all shipping costs related to their product.”

“Our production process is different for each product. For sod, we plant the seed, irrigate, cut, and roll the sod and then transport it. For the trees, we plant the root stock, graft the tree, water until a particular maturity and then dig it up and sell it. We inspect the plants as needed to make sure we are producing a quality product that is disease-free.”

“We have delayed purchasing some machinery that reduces time for the planting of the trees because it is a large up-front cost and we don’t want to have a huge outlay of cash if our profits keep going down.”

“The grass does not require as much irrigation as the trees, as it is at a lower elevation than the tree acres and is closer to the creek; it gets a lot of the run off.”

“Historically, we have always been able to sell everything we produce. Hopefully, that will continue since Houston is expanding rapidly.”

Compute the product costs for the sod and trees under traditional and ABC costing using the Microsoft® Excel® spreadsheet.

Write a 700- to 1,050-word paper analyzing Jeemp Farms and what data and information you will consider.

Include the following:

 

 

 

Describe any factors that could skew your results. In other words, explain if there is one method of costing that could make a product look more favorable than it really is.
 

 

Justify whether Mr. Beridon should cut the sod portion of his company.
 

 

Justify whether Mr. Beridon should cut the tree portion of his company instead.
 

 

Describe other methods of analysis you could use to help you come to a decision.
 

 

Describe any other qualitative or quantitative factors or changes to Mr. Beridon’s business that might be relevant to Jeemp Farms as they make the decision as to whether to use ABC and whether to cut sectors.
 

 

Determine any additional information you would need to have before making a recommendation.
 

 

 

Format your assignment to APA standards.

Click the Assignment Files tab to submit your assignment as a Microsoft® Word document.

 

 

ACC 349 Week 4 Connect Assignment
 

Access Connect.

Complete the Week 4 Problems.

1.

Award: 10 out of 10.00 points

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Puget Sound Divers is a company that provides diving services such as underwater ship repairs to clients in the Puget Sound area. The company’s planning budget for May appears below:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Puget Sound Divers 

Planning Budget

For the Month Ended May 31
  Budgeted diving-hours (q)
 
350
   Revenue ($480.00q)
$
168,000
 
 
 
  Expenses:
 
 
       Wages and salaries ($11,900 + $120.00q)
 
53,900
       Supplies ($4.00q)
 
1,400
       Equipment rental ($2,200 + $23.00q)
 
10,250
        Insurance ($3,900)
 
3,900
       Miscellaneous ($540 + $1.48q)
 
1,058
 
 
 
  Total expense
 
70,508
 
 
 
  Net operating income
$
97,492
 
 
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
During May, the company’s activity was actually 340 diving-hours. Complete the following flexible budget for that level of activity.
 
 

 

 

2.

Award: 10 out of 10.00 points

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Flight Café is a company that prepares in-flight meals for airlines in its kitchen located next to the local airport. The company’s planning budget for July appears below:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Flight Café 

Planning Budget

For the Month Ended July 31
  Budgeted meals (q)
 
23,000
  Revenue ($4.10q)
$
94,300
 
 
 
  Expenses:
 
 
      Raw materials ($2.10q)
 
48,300
      Wages and salaries ($6,400 + $0.20q)
 
11,000
      Utilities ($2,100 + $0.05q)
 
3,250
      Facility rent ($3,600)
 
3,600
      Insurance ($3,000)
 
3,000
      Miscellaneous ($500 + $0.10q)
 
2,800
 
 
 
  Total expense
 
71,950
 
 
 
  Net operating income
$
22,350
 
 
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

In July, 24,000 meals were actually served. The company’s flexible budget for this level of activity appears below:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Flight Café 

Flexible Budget

For the Month Ended July 31
  Budgeted meals (q)
 
24,000
  Revenue ($4.10q)
$
98,400
 
 
 
  Expenses:
 
 
      Raw materials ($2.10q)
 
50,400
      Wages and salaries ($6,400 + $0.20q)
 
11,200
      Utilities ($2,100 + $0.05q)
 
3,300
      Facility rent ($3,600)
 
3,600
      Insurance ($3,000)
 
3,000
      Miscellaneous ($500 + $0.10q)
 
2,900
 
 
 
  Total expense
 
74,400
 
 
 
  Net operating income
$
24,000
 
 
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
1.
Compute the company’s activity variances for July. (Indicate the effect of each variance by selecting “F” for favorable, “U” for unfavorable, and “None” for no effect (i.e., zero variance). Input all amounts as positive values.)
 
 
 

 

 

 

3.

Award: 10 out of 10.00 points

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quilcene Oysteria farms and sells oysters in the Pacific Northwest. The company harvested and sold 7,600 pounds of oysters in August. The company’s flexible budget for August appears below:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quilcene Oysteria 

Flexible Budget

For the Month Ended August 31
  Actual pounds (q)
 
7,600
  Revenue ($4.20q)
$
31,920
 
 
 
  Expenses:
 
 
      Packing supplies ($0.40q)
 
3,040
      Oyster bed maintenance ($3,200)
 
3,200
      Wages and salaries ($2,300 + $0.40q)
 
5,340
      Shipping ($0.65q)
 
4,940
      Utilities ($1,250)
 
1,250
      Other ($410 + $0.01q)
 
486
 
 
 
  Total expense
 
18,256
 
 
 
  Net operating income
$
13,664
 
 
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The actual results for August appear below:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quilcene Oysteria 

Income Statement

For the Month Ended August 31
  Actual pounds
 
7,600
  Revenue
$
26,800
 
 
 
  Expenses:
 
 
      Packing supplies
 
3,210
      Oyster bed maintenance
 
3,060
      Wages and salaries
 
5,750
      Shipping
 
4,670
      Utilities
 
1,060
      Other
 
1,106
 
 
 
  Total expense
 
18,856
 
 
 
  Net operating income
$
7,944
 
 
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
Compute the company’s revenue and spending variances for August. (Indicate the effect of each variance by selecting “F” for favorable, “U” for unfavorable, and “None” for no effect (i.e., zero variance). Input all amounts as positive values.)
 
 

 

 

 

4.

Award: 10 out of 10.00 points

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selected operating data for two divisions of Outback Brewing, Ltd., of Australia are given below:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
Division
 
Queensland
New South Wales
  Sales
$
1,144,000
$
2,220,000
  Average operating assets
$
520,000
$
600,000
  Net operating income
$
125,840
$
177,600
  Property, plant, and equipment (net)
$
252,000
$
202,000
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
1.
Compute the rate of return for each division using the return on investment (ROI) formula stated in terms of margin and turnover. (Round your answers to 2 decimal places.)
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2.
Which divisional manager seems to be doing the better job?
 
 
 

 

 

5.

In business, a budget is a method for putting a limit on spending.

True

False

 

 

 

 

6.

Fixed costs should be included in a flexible budget even though they do not change when the level of activity changes.

True

False

 

 

7.

A balanced scorecard should not contain any performance measures concerning customer satisfaction since the extent to which customers are satisfied is beyond the control of any manager in the company.

True

False

 

 

 

 

ACC 349 Week 5 Team Assignment, Part 3
 

You have completed the analysis of ABC and determined whether it is a good option for Jeemp Farms.

Create a 5- to 10-slide presentation with speaker notes for Jeemp Farms management that addresses the following:

 

 

 

Explain ABC costing and how it is different than traditional costing.
 

 

Explain the advantages/disadvantages of using ABC costing.
 

 

Define the terminology that is used in an ABC costing system.
 

 

Explain whether ABC is the preferential system for Jeemp Farms and why.
 

 

Recommend whether the company should discontinue the sod portion of the business and what outside factors might need to be considered prior to doing so.
 

 

List any non-financial factors that should be considered in decisions the company makes.
 

 

Include at least three outside credible sources in APA formatting at the end of your presentation so the management will know how to access more information about ABC.
 

 

 

Format your assignment to APA standards.

Click the Assignment Files tab to submit your assignment.

 

 

ACC 349 Week 5 Signature Assignment: Ethics on the Job
 

About Your Signature Assignment

Signature/Benchmark Assignments are designed to align with specific program student learning outcome(s) in your program. Program Student Learning Outcomes are broad statements that describe what students should know and be able to do upon completion of their degree. Signature/Benchmark Assignments are graded with a grading guide or an automated rubric that allows the University to collect data that can be aggregated across a location or college/school and used for course/program improvements.

Format your assignment to APA standards.

Submit your assignment to the Assignment Files tab as a Microsoft® Word document.

Identify a specific job within a specific company that you might be interested in applying for after you graduate from the University of Phoenix.

Research the job and the field in general, as well as ethical issues managerial accountants have faced that would pertain to that field. Also, educate yourself on the basics of operations within the job and company you have selected.

Write a 700- to 1,050-word paper to include the following:

 

 

 

Summarize the main duties of the job.
 

 

Describe a specific ethical issue you might face in that position using 2 credible sources to support your description.
 

 

Summarize the IMA’s standards of ethical practice and conflict resolution guide.
 

 

Analyze how the IMA’s standards of ethical practice and conflict resolution guide applies to the ethical issue.
 

 

Predict how you would handle the ethical issue.
 

 

Hypothesize what would happen if no one in the company followed the IMA’s standards of ethical practice.
 

 

Assess why it is important to follow the IMA’s standards of ethical practice.
 

 

Design or name any methods of internal controls you think could prevent or detect the unethical behavior in the future.
 

 

 

Click the Assignment Files tab to submit your assignment as a Microsoft® Word document.

 

 

 

ACC 349 Week 5 Connect Assignment
 

Access Connect.

Complete the Week 5 Problems.

1.

Award: 10 out of 10.00 points

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
Standard Quantity or Hours
Standard Price 

or Rate
Standard Cost
  Direct materials
6.7
 pounds
$
2.50
 per pound
$
16.75
  Direct labor
0.5
 hours
$
12.50
 per hour
$
6.25
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

During the most recent month, the following activity was recorded:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

a.
Thirteen thousand pounds of material were purchased at a cost of $2.40 per pound.
b.
The company produced only 1,300 units, using 11,700 pounds of material. (The rest of the material purchased remained in raw materials inventory.)
c.
Seven hundred and fifty hours of direct labor time were recorded at a total labor cost of $9,000.
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
Compute the materials price and quantity variances for the month. (Indicate the effect of each variance by selecting “F” for favorable, “U” for unfavorable, and “None” for no effect (i.e., zero variance). Do not round intermediate calculations.)
 
 

 

 

 

2.

Award: 10 out of 10.00 points

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SkyChefs, Inc., prepares in-flight meals for a number of major airlines. One of the company’s products is grilled salmon in dill sauce with baby new potatoes and spring vegetables. During the most recent week, the company prepared 4,300 of these meals using 1,250 direct labor-hours. The company paid these direct labor workers a total of $11,250 for this work, or $9.00 per hour.
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     According to the standard cost card for this meal, it should require 0.30 direct labor-hours at a cost of $8.50 per hour.
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
1.
According to the standards, what direct labor cost should have been incurred to prepare 4,300 meals? How much does this differ from the actual direct labor cost? (Round labor-hours per meal and labor cost per hour to 2 decimal places.)
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2.
Break down the difference computed in (1) above into a labor rate variance and a labor efficiency variance. (Indicate the effect of each variance by selecting “F” for favorable, “U” for unfavorable, and “None” for no effect (i.e., zero variance).)
 
 
 

 

 

 

 

3.

Award: 10 out of 10.00 points

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dawson Toys, Ltd., produces a toy called the Maze. The company has recently established a standard cost system to help control costs and has established the following standards for the Maze toy:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Direct materials: 6 microns per toy at $0.33 per micron
 Direct labor: 1.2 hours per toy at $6.70 per hour
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

During July, the company produced 5,400 Maze toys. Production data for the month on the toy follow:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Direct materials: 76,000 microns were purchased at a cost of $0.30 per micron. 35,500 of these microns were still in inventory at the end of the month.
Direct labor: 6,780 direct labor-hours were worked at a cost of $47,460.
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
1.
Compute the following variances for July: (Indicate the effect of each variance by selecting “F” for favorable, “U” for unfavorable, and “None” for no effect (i.e., zero variance). Do not round intermediate calculations. Round final answer to the nearest whole dollar.)
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

a.
The materials price and quantity variances.
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

b.
The labor rate and efficiency variances.
 
 
 

 

 

4.

Award: 10 out of 10.00 points

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Logistics Solutions provides order fulfillment services for dot.com merchants. The company maintains warehouses that stock items carried by its dot.com clients. When a client receives an order from a customer, the order is forwarded to Logistics Solutions, which pulls the item from storage, packs it, and ships it to the customer. The company uses a predetermined variable overhead rate based on direct labor-hours.
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     In the most recent month, 120,000 items were shipped to customers using 4,100 direct labor-hours. The company incurred a total of $11,480 in variable overhead costs.
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     According to the company’s standards, 0.03 direct labor-hours are required to fulfill an order for one item and the variable overhead rate is $2.85 per direct labor-hour.
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Required:
1.
According to the standards, what variable overhead cost should have been incurred to fill the orders for the 120,000 items? How much does this differ from the actual variable overhead cost? (Round labor-hours per item and overhead cost per hour to 2 decimal places.)
 
 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2.
Break down the difference computed in (1) above into a variable overhead rate variance and a variable overhead efficiency variance. (Indicate the effect of each variance by selecting “F” for favorable, “U” for unfavorable, and “None” for no effect (i.e., zero variance).)
 

 

 

 

5.

Award: 10 out of 10.00 points

 

 

An unfavorable labor rate variance can occur if workers with high hourly wage rates are assigned to work on products with standards that assume workers have low hourly wage rates.

True

False

 

 
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