Chapter 8 Homework - Cost Accounting 13 edition CHAPTER 8...

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Cost Accounting 13 edition CHAPTER 8 Activity Based Costing & Management 21, 22, 25, 29, 33, and 40 Not on My Accounting Lab 8-21 4-variance analysis, fill in the blanks. Variable Fixed 1. Spending variance 2. Efficiency variance 3. Production-volume variance 4. Flexible-budget variance 5. Underallocated (overallocated) MOH $4,200 U 4,500 U NEVER 8,700 U 8,700 U $3,000 U NEVER 600 U 3,000 U 3,600 U These relationships could be presented in the same way as in Exhibit 8-4. Actual Costs Incurred (1) Actual Input Qty. × Budgeted Rate (2) Flexible Budget: Budgeted Input Qty. Allowed for Actual Output × Budgeted Rate (3) Allocated: Budgeted Input Qty. Allowed for Actual Output × Budgeted Rate (4) Variable MOH $35,700 $31,500 $27,000 $27,000 Actual Costs Incurred (1) Same Budgeted Lump Sum (as in Static Budget) Regardless of Output Level (2) Flexible Budget: Same Budgeted Lump Sum (as in Static Budget) Regardless of Output Level (3) Allocated: Budgeted Input Qty. Allowed for Actual Output × Budgeted Rate (4) Fixed MOH $18,000 $15,000 $15,000 $14,400
An overview of the 4 overhead variances is: 4-Variance Analysis Spending Variance Efficiency Variance Production- Volume Variance Variable Overhead $4,200 U $4,500 U Never a variance Fixed Overhead $3,000 U Never a variance $600 U 8-22 Straightforward 4-variance overhead analysis. 1. The budget for fixed manufacturing overhead is 4,000 units × 6 machine-hours × $15 machine-hours/unit = $360,000. An overview of the 4-variance analysis is: 4-Variance Analysis Spending Variance Efficiency Variance Production- Volume Variance Variable Manufacturing Overhead $17,800 U $16,000 U Never a Variance Fixed Manufacturing Overhead $13,000 U Never a Variance $36,000 F Solution Exhibit 8-22 has details of these variances. A detailed comparison of actual and flexible budgeted amounts is: Actual Flexible Budget Output units (auto parts) 4,400 4,400 Allocation base (machine-hours) 28,400 26,400 a Allocation base per output unit 6.45 b 6.00 Variable MOH $245,000 $211,200 c Variable MOH per hour $8.63 d $8.00 Fixed MOH $373,000 $360,000 e Fixed MOH per hour $13.13 f a 4,400 units × 6.00 machine-hours/unit = 26,400 machine-hours b 28,400 ÷ 4,400 = 6.45 machine-hours per unit c 4,400 units × 6.00 machine-hours per unit × $8.00 per machine-hour = $211,200 d $245,000 ÷ 28,400 = $8.63
e 4,000 units × 6.00 machine-hours per unit × $15 per machine-hour = $360,000 f $373,000 ÷ 28,400 = $13.13 2. Variable Manufacturing Overhead Control 245,000 Accounts Payable Control and other accounts 245,000 Work-in-Process Control 211,200 Variable Manufacturing Overhead Allocated 211,200 Variable Manufacturing Overhead Allocated 211,200 Variable Manufacturing Overhead Spending Variance 17,800 Variable Manufacturing Overhead Efficiency Variance 16,000 Variable Manufacturing Overhead Control 245,000 Fixed Manufacturing Overhead Control 373,000 Wages Payable Control, Accumulated Depreciation Control, etc. 373,000 Work-in-Process Control 396,000 Fixed Manufacturing Overhead Allocated 396,000 Fixed Manufacturing Overhead Allocated 396,000 Fixed Manufacturing Overhead Spending Variance 13,000 Fixed Manufacturing Overhead Production-Volume Variance 36,000 Fixed Manufacturing Overhead Control 373,000 3. Individual fixed manufacturing overhead items are not usually affected very much by day-to-day control. Instead, they are controlled periodically through planning decisions and budgeting procedures that may

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