Sipple Furniture’s master budget for the year includes $360,000 for fixed supervisory salaries.Practical capacity, which is used to set the fixed overhead allocation rate, is 500 units per month.Supervisory salaries are expected to be incurred uniformly throughout the year. During August, thecompany produced 250 units, incurred production supervisory salaries of $29,000, and reportedunderapplied fixed overhead of $14,000 for supervisory salaries. What is Sipple Furniture’s supervisory salaries spending (budget) variance (rounded to the nearest whole dollar) for August? Is thisvariance favorable (F) or unfavorable (U)?

Sipple Furniture’s master budget for the year includes $360,000 for fixed supervisory salaries.Practical capacity, which is used to set the fixed overhead allocation rate, is 500 units per month.Supervisory salaries are expected to be incurred uniformly throughout the year. During August, thecompany produced 250 units, incurred production supervisory salaries of $29,000, and reportedunderapplied fixed overhead of $14,000 for supervisory salaries. What is Sipple Furniture’s supervisory salaries spending (budget) variance (rounded to the nearest whole dollar) for August? Is thisvariance favorable (F) or unfavorable (U)?

Name: Sipple Furniture’s master budget for the year includes $360,000 for fi
Uploaded: 2024-03-20T06:57:05.000Z
Channel: Bartleby
Description: Sipple Furniture’s master budget for the year includes $360,000 for fixed supervisory salaries.Practical capacity, which is used to set the fixed overhead allocation rate, is 500 units per month.Supervisory salaries are expected to be incurred unifor

Marketing

20th Edition

ISBN:9780357033791

Author:Pride, William M

Publisher:Pride, William M

Chapter19: Pricing Concepts

Section: Chapter Questions

Problem 6DRQ

See similar textbooks

Similar questions

Plan production for a four-month period: February through May. For February and March, you should produce to exact demand forecast. For April and May, you should use overtime and inventory with a stable workforce; stable means that the number of workers needed for March will be held constant through May. However, government constraints put a maximum of 5,000 hours of overtime labor per month in April and May (zero overtime in February and March). If demand exceeds supply, then backorders occur. There are 100 workers on January 31. You are given the following demand forecast: February, 90,000; March 65,000; April 110,000; May, 55,000. Productivity is four units per worker hour, eight hours per day, 20 days per month. Assume zero inventory on February 1. Costs are hiring, $50 per new worker; layoff, $70 per worker laid off; inventory holding, $10 per unit-month; straight-time labor, $10 per hour; overtime, $15 per hour; backorder, $20 per unit a. Find the total cost of this plan?
The president of HiU Enterprises, Terri Hill, projects the firm's aggregate demand requirements over the next 8 monthsas follows: Her operat ions manager is considering a new pla n, whichbegins in January with 200 uni ts on hand . Stockout cost of lostsales is SlOO per unit. Inventory holding cost is $20 per unit permonth. Ignore any idle-time costs. The plan is called plan A.Plan A: Vary the workforce level to execute a strategy that producesthe quantity demanded in the prior month. The Decemberdemand and rate of production are both I ,600 units per month. Thecost of hiring additional workers is $5,000 per I 00 uruts. The cost oflaying oiTworkers is $7,500 per 100 units. Evaluate this plan.
evelop a production plan and calculate the annual cost for a firm whose demand forecast is fall, 9,700; winter, 8,000; spring, 7,000; summer, 11,700. Inventory at the beginning of fall is 485 units. At the beginning of fall you currently have 35 workers, but you plan to hire temporary workers at the beginning of summer and lay them off at the end of summer. In addition, you have negotiated with the union an option to use the regular workforce on overtime during winter or spring only if overtime is necessary to prevent stockouts at the end of those quarters. Overtime is not available during the fall. Relevant costs are hiring, $80 for each temp; layoff, $160 for each worker laid off; inventory holding, $5 per unit-quarter; backorder, $10 per unit; straight time, $5 per hour; overtime, $8 per hour. Assume that the productivity is 0.5 unit per worker hour, with eight hours per day and 60 days per season. In each quarter, produce to the full output of your regular workforce, even if that…
A local firm manufactures children’s toys. The projected demand over the next four months for one particular model of toy robot is (given) Assume that a normal workday is eight hours. Hiring costs are $350 per worker and firing costs (including severance pay) are $850 per worker. Holding costs are $4.00 per aggregate unit held per month. Assume that it requires an average of 1 hour and 40 minutes for one worker to assemble one toy. Shortages are not permitted. Assume that the ending inventory for June was 600 of these toys and the manager wishes to have at least 800 units on hand at the end of October. Assume that the current workforce level is 35 workers. Find the optimal plan by formulating as a linear program.
The Morning Brew Coffee Shop sells Regular, Cappuccino,and Vienna blends of coffee. The shop’s current daily laborcost is $320, the equipment cost is $125, and the overheadcost is $225. Daily demands, along with selling price and ma-terial costs per beverage, are given below.Harald Luckerbauer, the manager at Morning Brew Cof-fee Shop, would like to understand how adding Eiskaffee (aGerman coffee beverage of chilled coffee, milk, sweetener,and vanilla ice cream) will alter the shop’s productivity. Hismarket research shows that Eiskaffee will bring in new cus-tomers and not cannibalize current demand. Assuming thatthe new equipment is purchased before Eiskaffee is added tothe menu, Harald has developed new average daily demandand cost projections. The new equipment cost is $200, andthe overhead cost is $350. Modified daily demands, as wellas selling price and material costs per beverage for the newproduct line, are given below. a. Calculate the change in labor and multifactor…
Mavis and John have joined forces to start M&J Food Products, a processor of packaged shredded lettuce for institutional use. John has years of food processing experience, and Mavis has extensive commercial food preparation experience. The process will consist of opening crates of lettuce and then sorting, washing, slicing, preserving, and finally packaging the prepared lettuce. Together, with help from vendors, they think they can adequately estimate demand, fixed costs, revenues, and variable cost per 5-pound bag of lettuce. They think a largely manual process will have monthly fixed cost of $50,000and a variable cost of $2.50 per bag. They expect to sell 75,000 bags of lettuce per month. They expect to sell the shredded lettuce for $3.25 per 5-pound bag. John and Mavis has been contacted by a vendor to consider a more mechanized process. This new process will have monthly fixed cost of $125,000 per month with a variable cost of $1.75 per bag. Based on the above scenario: Should…
EZ-Windows, Inc. manufacturers replacement windows for the home remodeling business. In January, the company produces 15,000 windows and ended the month with 9,000 windows in inventory. EZ-Windows' management team would like to develop a production schedule for the next three months. A smooth production schedule is obviously desirable because it maintains the current workforce and provides a similar month-to-month operation. However, given the sales forecasts, the productioncapacities, and the storage capabilities as shown in Table 2, the management team does not think a smooth production schedule with the same production quantity each month possible.The company's cost accounting department estimates that increasing production by one window from one month to the next will increase total costs by $1.00 for each unit increase in the production level. In addition, decreasing production by one unit from one month to the next will increase total costs by $0.65 for each unit decrease in the…
. If the opening backlog is 450 units, forecast demand is 700 units, and production is800 units, what will be the ending backlog?
Strategic cost management Nathaniel installs mufflers at NUBD Company. He is paid 500 per hour and an extra 100 per hour for every hour over 40 that is worked in a given week. Last week he worked 50 hours with 2 of these correctly classified as idle time. How much of Nathaniel’s wages last week should be included in manufacturing overhead cost?
Cranston Company estimates the following overhead costs for the coming year: Equipment depreciation $160,000Equipment maintenance 60,000Supervisory salaries 40,000Factory rent 100,000Total $360,000 Cranston is also budgeting $600,000 in direct labor costs and 15,000 machine hours for the coming year.(a) Calculate the predetermined overhead rate using direct labor costs as the allocation base. (b) Calculate the predetermined overhead rate using machine hours as the allocation base.
The Walden Manufacturing Corp. has office support salaries of $4,000, factory supplies of $1,000,indirect labor of $6,000, direct materials of $16,000, advertising expense of $2,500, office expense of$14,000, and direct labor of $20,000. What is the total period cost?
Develop a production plan and calculate the annual cost for a firm whose demand forecast is fall, 10,000; winter, 8,000; spring, 7,000; summer, 12,000. Inventory at the beginning of fall is 500 units. At the beginning of fall, you currently have 30 workers, but you plan to hire temporary workers at the beginning of summer and lay them off at the end of summer. In addition,you have negotiated with the union an option to use the regular workforce on overtime during winter or spring if overtime is necessary to prevent stock-outs at the end of those quarters. Overtime is not available during the fall. Relevant costs are hiring, $100 for each temp; layoff, $200 for each worker laid off; inventory holding, $5 per unit-quarter; backorder, $10 per unit; straight time, $5 per hour; over time, $8 per hour. Assume that productivity is 0.5 units per worker hour, with eight hours per day and 60 days per season. (Answer in Appendix D)