3310solmod15

3310solmod15 - to help the bottom line by spreading fixed...

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Module 15 Answers 15-1. For performance evaluation purposes, the costing format should identify the actual costs for comparison with expected costs during the relevant period. Under absorption costing, the manufacturing fixed costs are allocated on a per unit basis. An increase in production results in a lower per unit cost. If all of the production is sold, all of the fixed cost will be charged against profit. However, if some of the costs are assigned to inventory, the result can be a deferral of costs that should be evaluated at this time. This problem is highlighted by the suggestion that one can increase production in times of declining sales in order
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Unformatted text preview: to help the bottom line by spreading fixed costs over more units. 15-27. (20 min.) Variable Cost Variances: T-Star, Inc. a Standard labor wage rate = (Actual Direct Labor Direct Labor Price Variance) Actual hours worked = ($182,000 $6,500) 13,000 hrs. = $13.50 15-32. (20 min.) Fixed Cost Variances: Lihue Corporation 15-34. (30 min.) Comprehensive Cost Variance Analysis: Three Bridges, Inc. a. Variable cost variances: a 39,600 = 0.20 hours x 198,000 changes. b 33,000 = 1/6 hour x 198,000 changes. c 16,500 = 1/12 hour x 198,000 changes. b. Fixed overhead variances:...
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This note was uploaded on 11/13/2008 for the course ACCT 305 taught by Professor Franz during the Spring '07 term at S.F. State.

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3310solmod15 - to help the bottom line by spreading fixed...

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