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3 years ago

6

Exercise 21-15 Direct materials and direct labor variances LO P2 The following information describes production activities of Me

rcer Manufacturing for the year.
Actual direct materials used 16,000 lbs. at $4.05 per lb.
Actual direct labor used 5,545 hours for a total of $105,355
Actual units produced 30,000
Budgeted standards for each unit produced are 0.50 pounds of direct material at $4.00 per pound and 10 minutes of direct labor at $20 per hour.

Compute the direct materials price and quantity variances

2 answers:

Verdich [7]3 years ago

8 0

Answer:

Direct materials price variance = $800 Unfavorable

Direct materials quantity variance = $4,000 Unfavorable

Explanation:

Direct materials price variance = Aq×Ap-Aq×Sp

= (16,000×$4.05) - (16,000×$4.00)

= $800 Unfavorable

Direct materials quantity variance = Aq×Sp - Sq×Sp

= (16,000×$4.00) - (30,000×0.50 pounds×$4.00 )

= $4,000 Unfavorable

Molodets [167]3 years ago

6 0

Answer:

Instructions are below.

Explanation:

Giving the following information:

Actual direct materials used 16,000 lbs. at $4.05 per lb.

Actual units produced 30,000

Budgeted standards for each unit produced are 0.50 pounds of direct material at $4.00 per pound.

To calculate the direct material price and quantity variance, we need to use the following formulas:

Direct material price variance= (standard price - actual price)*actual quantity

Direct material price variance= (4 - 4.05)*16,000

Direct material price variance= $800 unfavorable

Direct material quantity variance= (standard quantity - actual quantity)*standard price

Standard quantity= 30,000*0.5= 15,000

Direct material quantity variance= (15,000 - 16,000)*4

Direct material quantity variance= $4,000 unfavorable

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Determine the number of cycles per day and the production quantity per cycle for this set of vehicles: Product Daily Quantity A

PIT_PIT [208]

Answer:

The Number of cycles is 4

Product Daily Quantity Daily Unit per cycle

A 18 18/4 = 4.5 units

B 16 16/4 = 4 units

C 4 4/4 = 1 unit

D 16 16/4 = 4 units

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2 years ago

The industrial organization (I/O) model of above-average returns:

lara [203]

Answer:

The answer is A) Puts emphasis on the external environment, which plays a role in determining a company´s ability to achieve above-average returns.

Explanation:

The I/O Model of Above-Average Returns basically assumes that the industry in which a company decides to compete in has a much larger influence on performance (earnings and profit) than the choices the managers of this company make.

The basic assumptions of this organization model are:

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Resources are highly mobile across companies, so that any differences that might develop between companies will be short-lived.
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3 years ago

What is the estimated economic profit in this example if the farmer plants watermelon on 500 acres??

Rzqust [24]

The economic profit is calculated by,

Economic Profit = Total Revenue (TR) – ( Explicit Cost + Implicit Cost)

Total Revenue $= 500 acre $6400 = $3200000$

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Explicit Cost for 500 acres $= 500 acres $625 = $ 312500$

Implicit Costs are not given

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Hence the economic profit is $$ 2887500$ .

<h3>Describe Economic Profit?</h3>

The difference between the revenue generated by the sale of an output and the prices of all inputs used, as well as all opportunity costs, is known as an economic profit. Possibility expenses and explicit costs are subtracted from earned revenues to establish economic profit. Economic profit is necessary because it helps examine an industry's financial and economic progress.

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2 years ago

On December 1, 2011, the Itami Wholesale Co. is attempting to project cash receipts and disbursements through January 31, 2012.

nignag [31]

Answer:

Itami Wholesale Co.

Cash Budget

December January

Beginning balance $88,000 $47,190

Cash collections 295,250 265,050

Total cash receipts $383,250 $312,240

Cash Disbursements:

Note payable $100,000

Payment for purchases $262,560 222,080

Payment for marketing,

distribution, and

customer-service 73,500 57,500

Total disbursements $336,060 $375,580

Ending cash balance $47,190 ($67,340)

Explanation:

a) Data and Calculations:

Inventory beginning balance = $65,200

Accounts payable beginning balance = $136,000

Sales:

50% collected ($ - 3%)

30% second month

14% third month

6% uncollectible

Actual and projected Sales:

October November December January February

Actual sales $280,000 $320,000

Estimated sales $330,000 $250,000 $240,000

50% collected ($ - 3%) $160,050 $121,250 $116,400

30% second month 96,000 99,000 75,000

14% third month 39,200 44,800 46,200

Total cash collections $295,250 $265,050 $237,600

Payment for merchandise: November December January February

Ending inventory 820 830 750 740

Sales in units 3,200 3,300 2,500 2,400

Units available for sale 4,020 4,130 3,250 3,140

Beginning inventory 780 820 830 750

Purchases 3,240 3,310 2,420 2,390

Cost of purchases $259,200 $264,800 $193,600 $191,200

Payment:

60% purchase month 155,520 158,880 116,160 114,720

40% the following month 103,680 105,920 77,440

Total payment for purchases $262,560 $222,080 $192,160

Budgeted marketing, distribution, and customer-service costs for the year = $600,000

Fixed cost = $120,000

Depreciation = $30,000

Cash payment for fixed cost = $90,000

Monthly payment for fixed cost = $7,500

Variable cost for the year = $480,000 ($600,000 - $120,000)

December = $330,000/$2,400,000 * $480,000 = $66,000

January = $250,000/$2,400,000 * $480,000 = $50,000

December January

Fixed cost payment $7,500 $7,500

Variable cost payment 66,000 50,000

Total cash payment $73,500 $57,500

4 0

3 years ago

A company maintains its records using cash-basis accounting. During the year, the company received cash from customers, $32,000,

Pani-rosa [81]

Answer:

Cash-basis net income is $7,000

Accrual-basis net income is $6,900

Explanation:

Cash-basis net income

Cash basis Net income is the net of cash receipt as income and paid as an expense. The net value of cash received from customers and paid for the salaries is considered as net income.

Net income = Cash received From Customers - Cash Paid for salaries = $32,000 - $25,000 = $7,000

Accrual-basis net income

Accrual-basis net income is the net value of accrued income and accrued expenses regardless of the receipt or payment of cash

First calculate the sales value

Ending account receivable = Beginning account receivable + Credit sales for the period - Cash received in the period

$5,200 = $3,600 + Credit sales for the period - $32,000

$5,200 = Credit sales for the period - $28,400

Credit sales for the period = $5,200 + $28,400 = $33,600

Now calculate the accrued salary expense for the period

Ending salaries payable = Beginning salaries payable + Salaries expense for the period - Cash paid in the period

$5,400 = 3,700 + Salaries expense for the period - $25,000

$5,400 = Salaries expense for the period - $21,300

Salaries expense for the period = $5,400 + $21,300 = $26,700

The net income is

Net Income = Accrued Sales - Accrued Expense = $33,600 - $26,700 = $6,900

6 0

2 years ago