16 of 21 41 derf corporation uses a standard cost

This preview shows page 16 - 20 out of 21 pages.

____________________16 of 21
We have textbook solutions for you!
/Intermediate-Algebra-Connecting-Concepts-through-Applications-2nd-Edition-9781337615587-2712/
The document you are viewing contains questions related to this textbook.
Chapter 2 / Exercise 10
Intermediate Algebra: Connecting Concepts through Applications
Clark
Expert Verified
41. Derf Corporation uses a standard cost system in which it applies manufacturingoverhead on the basis of standard direct labor-hours. Two direct labor-hours arerequired for each unit produced. The denominator activity was set at 9,000 units.Manufacturing overhead was budgeted at $135,000 for the period; 20 percent of thiscost was fixed. The 17,200 hours worked during March resulted in production of8,500 units. Variable manufacturing overhead cost incurred was $108,500 and fixedmanufacturing overhead cost was $28,000.Required:a. The variable overhead rate variance for March________________b. The variable overhead efficiency variance for March.________________c. The fixed manufacturing overhead budget variance for March________________d. The fixed manufacturing overhead volume variance for March________________17 of 21
42.Apex Company produces artificial Christmas trees. A local shopping mall recentlymade a special order offer; the shopping mall would like to purchase 200 extra-largewhite trees. Apex Company is currently producing and selling 20,000 trees; thecompany has the excess capacity to handle this special order. The shopping mall hasoffered to pay $120 for each tree. An accountant at Apex Company provides anestimate of the unit product cost as follows:Direct materials$40.00Direct labor (variable)$3.50Variable manufacturing overhead$1.00Fixed manufacturing overhead$4.00Total unit cost$48.50This special order would require an investment of $10,000 for the molds required for theextra-large trees. These molds would have no other purpose and would have no salvagevalue. The special order trees would also have an additional variable cost of $5.00 perunit associated with having a white tree. This special order would not have any effect onthe company's other sales.Required:a. Should Apex accept the order?____________________________b. What is the effect on net operating income of accepting the order? (direction andamount). Show your work!18 of 21
43.Northern Stores is a retailer in the upper Midwest. The most recent monthly incomestatement for Northern Stores is given below:TotalStore 1Store 2Sales$2,100,000$1,300,000$800,000Variable Expenses1,260,000882.000378,000Contribution Margin840,000418,000422,000Traceable Fixed Expenses420,000231,000189,000Segment Margin420,000187,000233,000Common Fixed Expenses350,000210,000140,000Net Operating Income$70,000$(23,000)$93,000Northern is considering closing Store I. If Store I is closed, one-fourth of its traceablefixed expenses would continue. Also, the closing of Store I would result in a 15%decrease in sales in Store II. Northern allocates common fixed expenses on the basis ofsales dollars and none of these costs would be saved if a store were shut down.Compute the overall increase or decrease in the net operating income of Northern Storesif Store I is closed. (direction and amount). Show your work!19 of 21

Upload your study docs or become a

Course Hero member to access this document

Upload your study docs or become a

Course Hero member to access this document

End of preview. Want to read all 21 pages?

Upload your study docs or become a

Course Hero member to access this document

Term
Winter
Professor
Adams
Tags
manufacturing Corporation
We have textbook solutions for you!
The document you are viewing contains questions related to this textbook.
Intermediate Algebra: Connecting Concepts through Applications
The document you are viewing contains questions related to this textbook.
Chapter 2 / Exercise 10
Intermediate Algebra: Connecting Concepts through Applications
Clark
Expert Verified

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture