Question
In: Accounting
Sara’s Systems manufactures audio systems for cars. Two models are produced: The Standard model has a...
Sara’s Systems manufactures audio systems for cars. Two models are produced: The Standard model has a budgeted price of $225 and a standard variable cost of $105. The Blaster model has a budgeted price of $505 and a standard variable cost of $185. At the beginning of the year, Sara estimated that she would sell 6,100 Blaster models and 24,400 Standard models. The actual results for the year showed that 7,220 Blaster models were sold for total revenues of $2,888,000. A total of 25,700 Standard models were sold for revenues of $6,682,000.
Required:
a. Compute the activity variance for the year. (Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.)
b. Compute the mix and quantity variances for the year. (Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.)
Solutions
ekkarill92 answered 1 year agoRelated Solutions
Kima Company manufactures and sells two models of a home appliance. The Standard model is a...
Kima Company manufactures and sells two models of a home
appliance. The Standard model is a basic appliance with mostly
manual features, while the Galaxy model is highly automated. The
appliances are produced to order, and there are no inventories at
the end of the year.
The cost accounting system at Kima allocates overhead to
products based on direct labor cost. Overhead in year 1, which just
ended, was $3,342,250. Other data for year 1 for the two products
follow:...
Kima Company manufactures and sells two models of a home appliance. The Standard model is a...
Kima Company manufactures and sells two models of a home
appliance. The Standard model is a basic appliance with mostly
manual features, while the Galaxy model is highly automated. The
appliances are produced to order, and there are no inventories at
the end of the year. The cost accounting system at Kima allocates
overhead to products based on direct labor cost. Overhead in year
1, which just ended, was $2,933,000. Other data for year 1 for the
two products follow:...
Dartmouth Corporation manufactures two models of office chairs, a standard and a deluxe model. The following...
Dartmouth Corporation manufactures two models of office chairs,
a standard and a deluxe model. The following activity and cost
information has been compiled:
Number
of Number
of Number
of
Product Setups Components Direct
Labor Hours
Standard 15 9 300
Deluxe 31 20 235
Overhead
costs $78,200 $89,900
Number of setups and number of components are identified as
activity-cost drivers for overhead. Assuming an activity-based
costing system is used, what is the total amount of overhead costs
assigned to the standard model?
A) $87,500
B) $114,700
C) $80,600
D) $84,050
Comfort Corporation manufactures two models of office chairs, a standard and a deluxe model. The following...
Comfort Corporation manufactures two models of office chairs, a
standard and a deluxe model. The following activity and cost
information has been compiled:
Number
of Number
of Number
of
Product Setups Components Direct
Labor Hours
Standard 12 8 255
Deluxe 28 12 245
Overhead
costs $52,000 $78,000
3) Assume a traditional costing system applies the overhead
costs based on direct labor hours. What is the total amount of
overhead costs assigned to the standard model?
A) $65,700
B) $63,600
C) $66,300
D) $66,700
4) Assume a traditional costing system applies the overhead
costs...
Penty's Fine Furniture manufactures two models of chairs, a standard and a deluxe model. The following...
Penty's Fine Furniture manufactures two models of chairs, a
standard and a deluxe model. The following activity and cost
information has been compiled:
Standard
Deluxe
# DL Hours
924
930
# Set Ups
28
62
# Components
5
8
Total estimated manufacturing overhead for the period is
$860,000. Penty's currently uses a volume-based costing system with
direct labor hours as the only cost driver.
a. Calculate the amount of manufacturing overhead allocated to
each product under a traditional volume-based system....
Mexpal Corporation manufactures two models of power drills, a standard and a deluxe model. The following...
Mexpal Corporation manufactures two models of power drills, a
standard and a deluxe model. The following activity and overhead
cost information has been compiled: Number of Number of Number of
Product Setups Components Direct Labor Hours Standard 15 10 800
Deluxe 35 15 400 Set-up activity Inspection Activity Overhead costs
$40,000 $32,000
1. Assume a traditional costing system applies the total
overhead costs (sum of set-up activity and inspection activity
costs) based on direct labor hours. What is the total...
Audio Accessories Ltd manufactures a model of compact disc holders which is produced in three separate...
Audio Accessories Ltd manufactures a model of compact disc
holders which is produced in three separate departments: Molding,
Assembly, and Finishing. It uses the weighted-average
process-costing method to account for the cost of production. The
following information was obtained for the Assembly Department for
the month of April.
Amount Percentage complete
WIP, 1 April (5,000 units)
Prior department costs transferred in from the Molding Department
$7,000 100%
Costs added by the Assembly Department
Direct materials $3,500 100%
Direct labour 4,500...
URGENT Mason Engineering manufactures audio devices for cars and uses job order costing. There are two...
URGENT
Mason Engineering manufactures audio devices for cars and uses
job order costing. There are two departments. In Department A,
overhead is applied on the basis of machine-hours, and in
Department B, on the basis of direct labor hours. At the start of
the current year, the following budget estimates were developed in
order to compute the overhead application rates:
Department A
Department B
Direct labor
$420,000
$300,000
Manufacturing overhead
$540,000
$412,500
Machine-hours
19,000
2,000
Direct labor hours
26,000
24,000...
Harmony Audio Company manufactures two models of speakers, DL and XL. Based on the following production...
Harmony Audio Company manufactures two models of speakers, DL
and XL. Based on the following production and sales data for
September 2016, prepare (a) a sales budget and (b) a production
budget.
DL
XL
Estimated inventory (units), September 1
253
70
Desired inventory (units), September 30
291
61
Expected sales volume (units):
East Region
3,500
3,900
West Region
4,800
4,200
Unit sales price
$100
$225
a. Prepare a sales budget.
Harmony Audio Company
Sales Budget
For the Month Ending September...
Go Camera manufactures and sells two types of cameras for cars and drones. These two models...
Go Camera manufactures and sells two types of cameras for cars
and drones. These two models are manufactured in separate
facilities and each facility is treated as profit center. Go Camera
serves as a supplier to car manufacturers as well as drone
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Drone Camera
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$100
Variable Cost
$30
$35
Fixed Cost
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$ 600,000
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