Answer Happy

(18 pts.) 4 Barkov Novelties Company, a maker of Christmas novelties, needs your leaving reviewing the information for last when help immediately. The company accountant resigned without adequate records or explanations for the data collected. In records for one product line, you find the following month: Materials purchased Materials used Direct labor costs incurred Variable overhead costs incurred Actual fixed overhead Completed units Direct materials Direct labor Variable overhead Fixed overhead 20,000 units @ $.60 each 15,000 units $36,000 $6,675 You learn that the standards for the product are: $7,200 7,000 2 units 1 hour $0.95 per direct labor hour $0.60 per direct labor hour You find a copy of the budget which shows that $ 6,000 was budgeted for Standard price per unit for materials S.62 Actual average wage rate fixed overhead, and that variable overhead was budgeted at $9,500 10,000 direct labor hours are worked per month. You also find some handwritten notes among the accountant's work papers, which indicate the following: $4.80 ($.20 less than the standard) Required: a) Compute the eight variances that were discussed in class. b) Comment on the results.

(18 pts.) 4 Barkov Novelties Company, a maker of Christmas novelties, needs your leaving reviewing the information for last when help immediately. The company accountant resigned without adequate records or explanations for the data collected. In records for one product line, you find the following month: Materials purchased Materials used Direct labor costs incurred Variable overhead costs incurred Actual fixed overhead Completed units Direct materials Direct labor You learn that the standards for the product are: Variable overhead Fixed overhead 20,000 units @ $.60 each 15,000 units $36,000 $6,675 $7,200 7,000 2 units 1 hour $0.95 per direct labor hour $0.60 per direct labor hour You find a copy of the budget which shows that $ 6,000 was budgeted for Standard price per unit for materials $.62 Actual average wage rate fixed overhead, and that variable overhead was budgeted at $9,500 10,000 direct labor hours are worked per month. You also find some handwritten notes among the accountant's work papers, which indicate the following: $4.80 (S.20 less than the standard) Required: a) Compute the eight variances that were discussed in class. b) Comment on the results.