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Performance Report Based on Budgeted and Actual Levels of Production Bowling Company budgeted the following amounts:...

  1. Performance Report Based on Budgeted and Actual Levels of Production

    Bowling Company budgeted the following amounts:

    Variable costs of production:
         Direct materials 3 pounds @ $0.60 per pound
         Direct labor 0.5 hr. @ $16.00 per hour
         VOH 0.5 hr. @ $2.20
    FOH:
         Materials handling $6,200
         Depreciation $2,600

    At the end of the year, Bowling had the following actual costs for production of 3,800 units:

    Direct materials $6,800
    Direct labor 30,500
    VOH 4,200
    FOH:
         Materials handling 6,300
         Depreciation $2,600

    Required:

    1. Calculate the budgeted amounts for each cost category listed above for the 4,000 budgeted units.
    $

    2. Prepare a performance report using a budget based on the expected production of 4,000 units. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number and if there are no entries enter "0" then select for "Not applicable".

    Bowling Company
    Performance Report
    Actual Budgeted Variance
    Units produced
    Direct materials $ $ $
    Direct labor
    Variable overhead
    Fixed overhead:
    Materials handling
    Depreciation
    Total $ $ $

    3. Prepare a performance report using a budget based on the actual level of production of 3,800 units. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number and if there is no entries enter "0" then select for "Not applicable".

    Bowling Company
    Performance Report
    Actual Budgeted Variance
    Units produced
    Direct materials $ $ $
    Direct labor
    Variable overhead
    Fixed overhead:
    Materials handling
    Depreciation
    Total $ $ $

Solutions

Expert Solution

Ans 1.
Bowling Company
Budget for 4000 units Per units Total Amt $
Units of Production 4000
Variable cost of Production
Direct Materials( 3 lb/unit@$0.6/lb) $              1.80 $       7,200.00
Direct Labor (0.5Hr/Unit , @$16/Hr)                  8.00 $     32,000.00
VOH (0.5Hr/Unit @$2.2/Hr) $              1.10 $       4,400.00
Tota Variable costs $     43,600.00
FOH
Material Handling $       6,200.00
Depreciation $       2,600.00
Total FOH $       8,800.00
Total Cost of Production $     52,400.00
Ans 2.
Performance Report; Actual   Budget Variance
Units Produced                3,800                 4,000                      200
Direct Materials $            6,800 $       7,200.00 $          (400.00)
Direct Labor $          30,500 $     32,000.00 $       (1,500.00)
Variable Overhead: $            4,200 $       4,400.00 $          (200.00)
Fixed Overhead
Material Handling $            6,300 $       6,200.00 $            100.00
Depreciation $            2,600 $       2,600.00 0
Total $          50,400 $           52,400 $       (2,000.00)
Ans 3.
Budget for 3800 units Per units Total Amt $
Units of Production 3800
Variable cost of Production
Direct Materials( 3 lb/unit@$0.6/lb) $              1.80 $       6,840.00
Direct Labor (0.5Hr/Unit , @$16/Hr)                  8.00 $     30,400.00
VOH (0.5Hr/Unit @$2.2/Hr) $              1.10 $       4,180.00
Tota Variable costs $     41,420.00
FOH
Material Handling $       6,200.00
Depreciation $       2,600.00
Total FOH $       8,800.00
Total Cost of Production $     50,220.00
Performance Report; Actual   Budget Variance
Units Produced                3,800                 3,800                         -  
Direct Materials $            6,800 $       6,840.00 $            (40.00)
Direct Labor $          30,500 $     30,400.00 $            100.00
Variable Overhead: $            4,200 $       4,180.00 $              20.00
Fixed Overhead
Material Handling $            6,300 $       6,200.00 $            100.00
Depreciation $            2,600 $       2,600.00 0
Total $          50,400 $           50,220 $            180.00

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