SDC Accounting 303 - Assignment 2

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Excelsior University *

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303

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Accounting

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Apr 3, 2024

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4

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® Study.com Accounting 303 - Assignment 2 If you have a Study.com College Saver membership and are seeking college credit for this course, you must submit all required assignments and pass the proctored final exam. You must submit your assignments before registering for the final. Below you will find prompts and instructions for submitting your assignment. About This Assignment Affordable Handbags Company (AHC) has been in business for three years and is growing steadily through an increase in product production. The company creates three handbag-style products: shoulder bags, wallets, and strapless buckle bags. AHC began as a single-person entrepreneurship venture in which the CEO designed each bag design. It uses two assembly lines to build products, as the wallets are assembled separately from the additional handbag styles. Business has increased by direct costs, and the products are marketed and sold online through two different vendors. You have been tasked as a cost accountant to assist AHC in conducting an Overhead and Variance Analysis that identifies product direct costs. Write an essay that includes your findings in 800-1,000 words. Explain your findings as well as the general concepts related to overhead variance analysis. While outside sources are NOT required for this assignment, formatting and citations for all parts of this assignment should be done in APA format. For more information on APA format, please see the following lesson: * What is APA Formatting: Style & Definition e APA Citation: Formats & Examples Prompt Evaluate the standard and actual cost sheets provided to calculate direct product costs for AHC. Allocate the overhead cost and provide a detailed variance analysis including both rate and volume variances for labor, raw materials, and factory overhead. First, calculate the standard dellar costs for the units of output. Then provide a detailed anglysigasima I8 SixwViak RIAHESS- X Required: Read more _r | e Compute the standard dollar costs for the uniis oi output * Compute AHC factory overhead volume variance. e Compute a detailed analysis of AHC Labor using both rate and volume variance.
e Compute a detailed analysis of AHC Raw materials using both rate and volume variance. * Compute a detailed analysis of AHC Factory Overhead using both rate and volume variance. Production & Cost Description Production & Cost Amounts Annual Production 1500 shoulder bags 2000 wallets 1000 buckle bags Raw materials in inches per unit (Width x Height x Depth = Volume) 1 shoulder bag =12"Wx 15" H x 8" D 1 wallet=6"Wx10"Hx5"D 1 buckle bag=13"Wx16"Hx10"D Raw materials price per unit volume $1 per foot Assembly labor time (hours per unit) 1 shoulder bag = 4 hours 1 wallet =2 hours 1 buckle bag = 4 hours Labor pay rate $20 per hour Assembly department overhead per direct labor hour $10 Color dying process machine hours (MH) 1 shoulder bag = 0.5 MH 1 wallet =0.5 MH 1 buckle bag = 0.5 MH Painting department overhead per MH $20 1 shoulder bag = $210 Sales price 1 wallet = $140 1 buckle bag = $210 Fixed Cost $10,000 Variable SG&A $3 per unit for all three types (bags, wallets, buckles) Fixed SG&A $25,000 Actual amount of material purchased and used 9,990,000 inches The actual cost of material purchased and used The actual amount of direct labor hours The actual cost of direct labor Actual production in units $832,500 20,000 $450,08hat can | help you with today? X Shouldesdaagsre 3.775 Wallets = 3,829 Buckle Bags = 2,380 Actual overhead spending $378,773
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