The following information related to Q for the year ended 28 February 20X3: $ Prime cost 122,000 Factory overheads 185,000 Opening work-in-progress at 1 March 20X2 40,000 Factory cost of goods completed 300,000 The closing work-in-progress at 28 February 20X3 was..................................
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
The following information related to Q for the year ended 28 February 20X3:
$
Prime cost 122,000
Factory
Opening work-in-progress at 1 March 20X2 40,000
The closing work-in-progress at 28 February 20X3 was..................................
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- 4. Selected account balances for the year ended December 31 are provided below for MelodyCompany:Selling and Administrative salaries . . . . . . . . . . . . . . . . . . . . P110,000Purchases of raw materials . . . . . . . . . . . . . . . . . . . . . . . . . . P290,000Direct Labor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ?Advertising expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . P80,000Manufacturing overhead . . . . . . . . . . . . . . . . . . .. . . . . . . . . . P270,000Sales commissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . P50,000 Inventory balances at the beginning and end of the year were as follow:Beginning of the year End of the yearRaw materials . . . . . . . . . . . . . . P40,000 P10,000Work in process . .. . . . . . . .. . . ? P35,000Finished goods . . . . . . . . . . . . . P50,000 ? The total manufacturing costs for the were P683,000; the goods available for sale totaledP740,000; and the…Determine the missing amounts. TotalManufacturingCosts Workin Process(January 1) Workin Process(December 31) Cost ofGoodsManufactured (1) $ 151,000 $120,000 $82,000 $ X (2) $296,000 $ X $98,000 $331,000 (3) $310,000 $463,000 $ X $715,000Question Content Area At the end of the year, overhead applied was $3,772,000. Actual overhead was $3,472,000. Closing over/underapplied overhead into Cost of Goods Sold would cause net income to a. decrease by $300,000 b. increase by $300,000 c. decrease by $600,000 d. increase by $600,000
- QuestionQ# 1: Accounting for Manufacturing Concern The following data from the just completed year are taken from the accounting records of KentonCompany:Sales $ 975,000Direct labor cost $ 165,000Raw material purchases $ 229,000Selling expense $ 48,750Administrative expenses $ 146,250Manufacturing overhead applied to work in process $ 180,000Actual manufacturing overhead costs $ 175,050Inventories: Beginning EndingRaw materials $ 18,000 $ 17,500Work in process $ 20,000 $ 14,750Finished goods $ 9,000 $ 11,000Required:1. Prepare a schedule of cost of goods manufactured. Assume all raw materials used in productionwere direct materials.2. Prepare a schedule of cost of goods sold. Assume that the company’s underapplied or overappliedoverhead is closed to Cost of Goods Sold.3. Prepare an income statementInventories: March 1 March 31Raw material P18,000 P15,000Work in process 9,000 6,000Finished goods 27,000 36,000Additional information for March:Raw material purchased P42,000Direct labor payroll 30,000Direct labor rate per hour 7.50Overhead rate per direct labor hour 10.00 Required a. prime cost incurred b.conversion cost incurred c. Cost of Goods ManufacturedSelected account balances and transactions of Alpine Manufac-turing Co. follow: Account BalancesMay 1 May 31Raw materials . . . .................................. $ 6,000 $ 5,500Factory supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 800 900Work in process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,500 6,500Finished goods .................................... 12,000 13,200May Transactions:a. Purchased raw materials and factory supplies on account atcosts of $45,000 and $10,000, respectively. (One inventoryaccount is maintained.)b. Incurred wages during the month of $65,000 ($15,000 was forindirect labor).c. Incurred factory overhead costs in the amount of $42,000 onaccount.d. Made adjusting entries to record $10,000 of factory overhead for items such as depreciation (credit Various Credits). Fac-tory overhead was closed to Work in Process. Completed jobs were transferred to Finished Goods, and the cost of jobssold was charged…
- 6. WIP, beginning has a balance of 100,000 (consist of Job1 with cost of 40,000; Job 2 costing 10,000 and Job 3.) Raw materials purchased totaled P 400,000; Total Payroll for production is 200,000, net of deductions of 20,000 (SSS, Pag ibig and W/tax). Raw materials inventory increased by 120,000 and indirect materials used amounted to 50,000. Indirect labor cost incurred is 10,000. Overhead cost is applied at 50% of Direct labor cost. At the end of the period, only Job 3 is still incomplete where total direct labor cost and direct materials of 40,000 and 60,000, respectively, were added during the period. What is the Cost of goods manufactured?6.Disposition of Over- or Underapplied Overhead. The following information is available concerning theinventory and cost of goods sold accounts of PGA Company at the end of the most recent year:Work in Finished Cost of GoodsProcess Goods SoldDirect material .............................................................................. $ 5,000 $ 8,000 $ 11,000Direct labor ................................................................................... 6,000 15,000 15,000Applied overhead ......................................................................... 4,000 12,000 24,000Year-end balance.......................................................................... $ 15,000 $ 35,000 $ 50,000Applied overhead has already been closed to Factory Overhead Control.Required:Give the journal entry required to close Factory Overhead Control, assuming:(1) Overapplied overhead of $10,000 is to be allocated to inventories and Cost of Goods Sold in proportionto the balances in those…Question 1Part IAdvent Corporationhas provided the following data for its activities for the month of May.Beginning Raw Materials Inventory$75,000Ending Raw Materials Inventory$45,000Purchases of Raw Materials$550,000Direct Labour Incurred$120,000Manufacturing Overheads Incurred$250,000Beginning Work in Process$60,000Ending Work in Process$140,000Required: Prepare a schedule of the Cost of Goods Manufactured for the month of May.
- Compute the ending balance of the Work-in-Process Inventory account for July. Job X14 Job X15 Total Direct materials $35,420 $14,700 $50,120 Direct labor 105,000 69,000 174,000 Applied overheadelected accounts with amounts omitted are as follows Work in Process Aug. 1 Balance 275,000 Aug. 31 Goods finished 1,030,000 31 Direct materials X 31 Direct labor 450,000 31 Factory overhead X Factory Overhead Aug. 1–31 Costs incurred 145,000 Aug. 1 Balance 15,000 31 Applied (30% of direct labor cost) X If the balance of Work in Process on August 31 is $220,000, what was the amount debited to Work in Process for direct materials in August?2 ABC supplier incurred the following actual costs during the year just ended: Direct material used $210,500 Direct labour 185 000 Manufacturing overhead 380,000. The inventory balances, on 1 January, were as follows: Raw material $47 000 Work in process $61 500 Finished goods $60 000. Each of these inventory balances was 10 percent higher at the end of the year. The cost of goods sold is: Select one: a. $765,250 b. $762,850 c. $760,000 d. None of the answers given 3 David Furniture Ltd incurred the following actual costs during the year just ended: Direct material used $200,020 Direct labour $190,000 Manufacturing overhead $278, 000. The inventory balances, on 1 January, were as follows: Raw material $47 000; Work in process $61 500 Finished goods $65 000. Each of these inventory balances was 10 percent lower at the end of the year. The cost of goods manufactured is: Select one: a. None of the answers given b. $674,000 c. $670,000 d. 650,000 4 ABC Ltd prepares…