Vohspendingvariancesactualquantityofcostdriverx

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Unformatted text preview: 8% of sales collected in the second month following • • the sale, and 2% of sales are uncollectible. Chapter 6 Chapter 6 • Cash collections for September are? • What is the ending balance of accounts receivable for September, assuming uncollectible balances are written off during the second month following the sale? • Cash collections for October are: Chapter 6 Chapter 6 • Cash collections for September are? • ($110,000 x 0.65) + ($80,000 x 0.25) + ($100,000 x • • • • 0.08) = $99,500 What is the ending balance of accounts receivable for September, assuming uncollectible balances are written off during the second month following the sale? ($110,000 x 0.35) + ($80,000 x 0.10) = $46,500 Cash collections for October are: ($90,000 x 0.65) + ($110,000 x 0.25) + ($80,000 x 0.08) = $92,400 Chapter 7 Chapter 7 • You need to know: – The static budget. – The flexible budget. – What happens at level 0, level 1, level 2 variance analysis. Chapter 7 Chapter 7 • These equation will be provided to you • • • • with the exam: Material price variance = AQ ( AP – SP) Material efficiency variance = SP (AQ – SQ) Labor price variance =AQ ( AP – SP) Labor efficiency variance = SP (AQ – SQ) Chapter 7 Chapter 7 • These equation will be provided to you with the exam: • Variable OH variances: – VOH Efficiency variance = Budgeted cost per unit of cost driver X (actual cost driver – Budgeted cost driver). – VOH spending variances: = actual quantity of cost driver X (actual cost per cost driver – Budgeted cost per cost driver) – Fixed OH Spending variance = Actual costs – budgeted costs – Production volume variance = Budgeted fixed OH – Applied OH • Fixed OH variances: Chapter 7 Chapter 7 • You need to know the following equations THEY ARE NOT PROVIDED ON THE EXAM: • Flexible budget variance =actual results – flexible budget • Sales volume variance = flexible budget­ static budget • Static budget variance = static budget – Actual results Chapter 7 Chapter 7 • You need to know: • Standards: A standard is a predetermined cost, price or quantity, which serves as a benchmark against which to compare the actual numbers. Chapter 7 Chapter 7 • You need to know: • The journal entry to record materials used? • Example: 650,000 • Work in Process Control • Direct­Materials Efficiency Variance 40,625 Materials Control 690,625 • • (unfavorable variance) Chapter 7 Chapter 7 • You need to know: • What is the journal entry to re...
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This note was uploaded on 04/05/2010 for the course BUSINESS 11 taught by Professor 11 during the Spring '10 term at University of Hawaii, Manoa.

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