Toys World started and finished job number A26, a batch of 1,000 cuddly koalas, during March 2020.The job required $4,850 of direct material and 32 hours of direct labour at $20 per hour. Thepredetermined overhead rate is $10.50 per direct labour hour. On 31st March, 900 of the cuddlykoalas were shipped to a local toy shop.Required:a) Prepare journal entries to record the incurrence of production costs, completion of job numberA26 and the shipment of 900 cuddly koalas to local toy shop. b) Calculate the cost per cuddly koala for job number A26. c) How might the managers at Toys World use this information
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.
Toys World started and finished job number A26, a batch of 1,000 cuddly koalas, during March 2020.
The job required $4,850 of direct material and 32 hours of direct labour at $20 per hour. The
predetermined overhead rate is $10.50 per direct labour hour. On 31st March, 900 of the cuddly
koalas were shipped to a local toy shop.
Required:
a) Prepare
A26 and the shipment of 900 cuddly koalas to local toy shop.
b) Calculate the cost per cuddly koala for job number A26.
c) How might the managers at Toys World use this information
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