Managerial Accounting (5th Edition)
5th Edition
ISBN: 9780134128528
Author: Karen W. Braun, Wendy M. Tietz
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Concept explainers
Textbook Question
Chapter 11, Problem 11.18AE
Calculate
Grow Right Products is a manufacturer of large flower pots for urban settings. The company has these standards:
Direct materials (resin) | 9.6 pounds per pot at a cost of $4.55 per pound |
Direct labor | 1.0 hour at a cost of $15.80 per hour |
Standard variable manufacturing |
$3.40 per direct labor hour |
Predetermined fixed manufacturing overhead rate | $6.00 per direct labor hour |
Grow Right allocates variable and fixed manufacturing overhead to production based on standard direct labor hours.
Requirements
- 1. Compute the standard cost of each of the following inputs per pot: direct materials, direct labor, variable manufacturing overhead, and fixed manufacturing overhead.
- 2. Determine the standard cost of one flower pot.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Northern Defense manufactures radar systems. It has just completed the manufacture of its first newly designed system, RS-32. Manufacturing data for the RS-32 follow:
(Click icon to view data)
Requirement
Calculate the total variable costs of producing 2, 4, and 8 units.
Begin by calculating the cumulative total time in labor-hours using the cumulative average-time learning model. (Round the cumulative average time per unit to the nearest whole number.)
Cumulative number of Cumulative average time
Cumulative total time:
per unit: Labor-hours
Labor-hours
3700
units
2
4
8
3700
←
Data table
Direct material cost
Direct manufacturing labor time for first unit
Learning curve for manufacturing labor time per radar system
Direct manufacturing labor cost
Variable manufacturing overhead cost
Using the formula for an 85% learning curve, b =
In 0.85
In 2
Print
=
$
$
$
-0.162519
0.693147
81,000 per unit of RS-32
3,700 direct manufacturing labor-hours
85% cumulative average timeª
Done
28 per direct…
20A Forecast costs at different volumes (Learning Objectives 1 & 2)
Famsworth Drycleaners has capacity to clean up to 7,500 garments per month.
Requirements
1. Complete the following schedule for the three volumes shown.
4,500 Garments
6,000 Garments
7,500 Garments
Total variable costs
$4,200
Total fixed costs
Total operating costs
Variable cost per garment
Fxed cost per garment
$2.40
Average cost per garment
2. Why does the average cost per garment change?
3. Suppose the owner, Dustin Farnsworth, erroneously uses the average cost per unit at
full capacity to predict total costs at a volume of 4,500 garments. Would he overesti-
mate or underestimate his total costs? By how much?
$4-3 Compute departmental overhead rates (Learning Objective 1)
Snyder Snacks makes potato chips, corn chips, and cheese puffs using three different pro-
du
es wi
the same manufacturing plant. Currently, Snyder uses a single plant-
wide overhead rate to allocate its $3,311,500 of annual manufacturing overhead. Of this
amount, $2,070,000 is associated with the potato chip line, $763,000 is associated with
the corn chip line, and $478,500 is associated with the cheese puff line. Snyder's plant is
currently running a total of 17,900 machine hours: 11,500 in the potato chip line, 3,500 in
the corn chip line, and 2,900 in the cheese puff line. Snyder considers machine hours to
be the cost driver of manufacturing overhead costs.
1. What is Snyder's plantwide overhead rate?
2. Calculate the departmental overhead rates for Snyder's three production lines. Round
all answers to the nearest cent.
3. Which products have been overcosted by the plantwide rate? Which products have
been undercosted by…
Chapter 11 Solutions
Managerial Accounting (5th Edition)
Ch. 11 - (Learning Objective 1) Which of the following is...Ch. 11 - (Learning Objective 2) The direct material price...Ch. 11 - Prob. 3QCCh. 11 - Prob. 4QCCh. 11 - Prob. 5QCCh. 11 - (Learning Objective 4) Which of the following is...Ch. 11 - Prob. 7QCCh. 11 - (Learning Objective 6) Which of the following is...Ch. 11 - Prob. 9QCCh. 11 - (Learning Objective 7Appendix) Which of the...
Ch. 11 - Compute the standard cost of direct materials...Ch. 11 - Compute the standard cost of direct labor...Ch. 11 - Explain a direct material variance (Learning...Ch. 11 - Prob. 11.4SECh. 11 - Calculate direct material variances when the...Ch. 11 - Calculate direct labor variances (Learning...Ch. 11 - Prob. 11.7SECh. 11 - Prob. 11.8SECh. 11 - Calculate fixed overhead variances (Learning...Ch. 11 - Calculate and interpret fixed overhead variances...Ch. 11 - Prob. 11.11SECh. 11 - Calculate and interpret overhead variances...Ch. 11 - Record costing transactions (Learning Objective 7)...Ch. 11 - Record standard costing transactions (Learning...Ch. 11 - Identify ethical standards violated (Learning...Ch. 11 - Vocabulary (Learning Objectives 1, 2, 3, 4, 5, 6)...Ch. 11 - Calculate standard cost and gross profit per unit...Ch. 11 - Calculate standard cost per unit (Learning...Ch. 11 - Calculate and explain direct material variances...Ch. 11 - Calculate missing direct material variables...Ch. 11 - Calculate and explain direct labor variances...Ch. 11 - Calculate and interpret direct material and direct...Ch. 11 - Calculate the material and labor variances...Ch. 11 - Record materials and labor transactions (Learning...Ch. 11 - Calculate the standard cost of a product before...Ch. 11 - Recognize advantages and disadvantages of standard...Ch. 11 - Compute and interpret overhead variances (Learning...Ch. 11 - Data Set for E11-28A through E11-32A Country...Ch. 11 - Data Set for E11-28A through E11-32A Country...Ch. 11 - Data Set for E11-28A through E11-32A Country...Ch. 11 - Make journal entries in a standard costing system...Ch. 11 - Prepare a standard cost income statement (Learning...Ch. 11 - Calculate standard cost and gross profit per unit...Ch. 11 - Calculate the standard cost per unit (Learning...Ch. 11 - Calculate and explain direct material variances...Ch. 11 - Calculate missing direct material variables...Ch. 11 - Calculate and explain direct labor variances...Ch. 11 - Prob. 11.38BECh. 11 - Prob. 11.39BECh. 11 - Prob. 11.40BECh. 11 - Prob. 11.41BECh. 11 - Recognize advantages and disadvantages of standard...Ch. 11 - Calculate and interpret overhead variances...Ch. 11 - Prob. 11.44BECh. 11 - Prob. 11.45BECh. 11 - Prob. 11.46BECh. 11 - Prob. 11.47BECh. 11 - Prob. 11.48BECh. 11 - Prob. 11.49APCh. 11 - Comprehensive standards and variances problem...Ch. 11 - Comprehensive standards and variances problem...Ch. 11 - Prob. 11.52APCh. 11 - Prob. 11.53APCh. 11 - Prob. 11.54BPCh. 11 - Comprehensive standards and variances problem...Ch. 11 - Comprehensive standards and variances problem...Ch. 11 - Work backward through labor variances (Learning...Ch. 11 - Determine all variances and make journal entries...Ch. 11 - Calculate labor variances in a hotel (Learning...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- E19-15 Computing and using single plantwide overhead allocation rate Learning Objective 1 Basic $322,000 Koehler makes handheld calculators in two models: basic and professional. Koehler estimated $721,000 of manufacturing overhead and 515,000 machine hours for the year. The basic model actually consumed 230,000 machine hours, and the professional model consumed 285,000 machine hours. Compute the predetermined overhead allocation rate using machine hours (MHr) as the allocation base. How much overhead is allocated to the basic model? To the professional model?arrow_forwardCompute departmental overhead rates (Learning Objective 1)54-4Snyder Snacks makes potato chips, corn chips, and cheese puffs using three different pro- duction lines within the same manufacturing plant . Currently, Snyder uses a single plant- wide overhead rate to allocate its $3,311,500 of annual manufacturing overhead . Of this amount, $2,070,000 is associated with the potato chip line, $763,000 is associated with the corn chip line, and $478,500 is associated with the cheese puff line. Snyder's plant is currently running a total of 17,900 machine hours: 11,500 in the potato chip line, 3,500 in the corn chip line, and 2,900 in the cheese puff line. Snyder considers machine hours to be the cost driver of manufacturing overhead costs .1. What is Snyder's plantwide overhead rate?2. Calculate the departmental overhead rates for Snyder's three production lines. Roundall answers to the nearest cent .3. Which products have been overcosted by the plantwide rate? Which products havebeen…arrow_forwardeleam.squ.euu.om/mod/qu12/attempt.p learning System (Academic) stion 3 Company XYZ uses machine hours to allocate its manufacturing overhead. The company estimates that total machine hours to be operated next year are 190,000 hours. The estimated variable overhead is $9 per hour and the estimated fixed overhead costs are $152,000. Calculate wer saved ked out of 2 the predetermined overhead rate. lag question Select one: O a. $9.80 O b. $0.80 O c. $10.80 O d. $0.10 O e. None of the answers given Clear my choicearrow_forward
- I have the following information: direct materials $250 and total manufacturing cost $700. Overhead applied to jobs at a rate of 200% of direct labor cost. This is for Chapter 2 job costing in managerial accounting. I am supposed to figure out conversion cost, direct labor cost, and manufacturing overhead. I know the formula for conversion cost= direct labor + manufacturing OH Prime cost= direct labor + direct materials How do I figure out direct labor cost with the given information? The learning objective states calcualte predetermined overhead rate, but I do not have estimated manufacturing cost and estimated labor. Can you please help? Thanks, Erica Gordonarrow_forwardPIUK Learning Ma Happy Valley Land and Snow Company provides the following ABC costing information: Activities Total Costs Activity-cost drivers Labor hours $320,000 8,000 hours Gas $36,000 6,000 gallons Invoices $40,000 2,500 invoices Total costs $396,000 The above activities used by their three departments are: Lawn Department Bush Department Plowing Department Labor hours 2,500 hours 1,200 hours 4,300 hours Gas 1,500 gallons 800 gallons 3,700 gallons Invoices 1,600 invoices 400 invoices 500 invoices How much of the labor cost will be assigned to the Lawn Department? Select one: a. $100,000 b. s25,600 c. S40,000arrow_forwardPlease answer parts 5-8 according to the images attached below. Highland Company produces a lightweight backpack that is popular with college students. Standard variable costs relating to a single backpack are given below: Standard Quantity or Hours Standard Price or Rate Standard Cost Direct materials ? $ 5.00 per yard $ ? Direct labor ? ? ? Variable manufacturing overhead ? $ 2 per direct labor-hour ? Total standard cost per unit $ ? Overhead is applied to production on the basis of direct labor-hours. During March, 780 backpacks were manufactured and sold. Selected information relating to the month’s production is given below: Materials Used Direct Labor Variable Manufacturing Overhead Total standard cost allowed* $ 15,600 $ 13,104 $ 2,496 Actual costs incurred $ 13,112 ? $ 5,491 Materials price variance ? Materials quantity variance $ 790 U Labor rate variance ? Labor efficiency variance ? Variable…arrow_forward
- Activity-Based Costing, Lean Operations, and the Costs of Quality E4-24A Compare traditional and ABC allocations on a job (Learning Objective 2) Radley Products has adopted an ABC costing system. The following manufacturing activi- ties, indirect manufacturing costs, and cost drivers have been identified: Activity Machine setup Total estimated MOH costs related to activity Total estimated amount of allocation base activity $ 120,000 $1,050,000 Machining Polishing Quality control Facility-level costs sdngas 000' 6,000 machine hours 10,000 polishing cloths 4,000 tests run 50,000 DL hours 000'08 $ 280,000 $ 120.000 Total manufacturing overhead (MOH) $1.650.000 The Job Cost Record for Job #624 revealed that direct materials requisitioned for the job totaled $1,050. The Job Cost Record also showed that direct labor for this job totaled 10 hours at a wage rate of 525 per hour. Other data collected on the resources used by Job #624 included: 1 machine setup required 5 machine hours 2…arrow_forwardBordner Company manufactures HVAC (heating, ventilation, and air conditioning) systems for commercial buildings. For each new design, Bordner faces a 90 percent learning rate. On average, the first unit of a new design takes 600 hours. Direct labor is paid 25 per hour. Required: 1. Set up a table with columns showing: the cumulative number of units, cumulative average time per unit in hours, and cumulative total time in hours. Show results by row for total production of one unit, two units, four units, eight units, and sixteen units. (Round hour answers to two significant digits.) 2. What is the total labor cost if Bordner makes the following number of units: one, four, sixteen? What is the average cost per system for the following number of systems: one, four, or sixteen? (Round your answers to the nearest dollar.) 3. Using the logarithmic function, set up a table with columns showing: the cumulative number of units, cumulative average time per unit in hours, cumulative total time in hours, and the time for the last unit. Show results by row for each of units one through eight. (Round answers to two significant digits.)arrow_forwardPower Trampolines produces fitness trampolines for both personal and commercial use. An up-and-coming fitness. facility brand, Bounce It Out, has just asked Power Trampolines for a quote to purchase 300 trampolines for use in its facilities. Power Trampolines provided the following quote to Bounce It Out: Quote for Bounce It Out Manufacturing Costs Direct Materials $11,850 Direct Labor 8, 500 Manufacturing Overhead 15,800 Total Costs $36, 150 Markup (per company policy) 60% Total Estimated Price $57,840 As a fairly new company, Bounce It Out is unable to pay this amount. They provide a counter-offer of $45,000 for the 300 trampolines. The company asks for your help in deciding whether or not to accept this offer. They provide you with the following information to aid in your decision: - They have excess capacity and could manufacture the 300 trampolines without impacting their other manufacturing needs - Manufacturing overhead is allocated based on direct labor dollars -Budgeted…arrow_forward
- Life Force Fitness, Inc., assembles and sells treadmills. Activity-based product information for each treadmill is as follows: ETT Activity-Base Usage (hrs. per unit) Activity Rate per Hour Activity Motor assembly Activity Cost $30.00 1.50 $20 Final assembly Testing 1.00 18 18.00 0.25 22 5.50 Rework 0.40 22 8.80 Moving Activity cost per unit 3.00 $65.30 0.20 15 All of the activity costs are related to labor. Management must remove $2.00 of activity cost from the product in order to remain competitive. Rework involves disassembling and repairing a unit that fails testing. Not all units require rework, but the average is 0.40 hour per unit. Presently, the testing is done on the completed assembly; but much of the rework has been related to motors, which can be tested independently prior to adding the motor to the treadmill during final assembly. Thus, motor issues can be diagnosed and solved without having to disassemble the complete treadmill. This change will reduce the average rework…arrow_forwardLearning Objectives 2, 3, 4 1. Total cost per EUP $2.26 3. WIP Balance $1,836 Open with P18-38B Preparing a production cost report, two materials added at different points, no beginning WIP or costs transferred in; journal entries Bryan's Exteriors produces exterior siding for homes. The Preparation Department begins with wood, which is chopped into small bits. At the end of the process, an adhesive is added. Then the wood/adhesive mixture goes on to the Compression Department, where the wood is compressed into sheets. Conversion costs are added evenly throughout the preparation process. January data for the Preparation Department are as follows: UNITS Beginning Work-in-Process Inventory Started in production Completed and transferred out to Compression in January Ending Work-in-Process inventory (35% of the way through the preparation process) COSTS Beginning Work-in-Process Inventory Costs added during January: Wood Adhesives Direct labor Manufacturing overhead allocated Total costs…arrow_forwardLife Force Fitness, Inc., assembles and sells treadmills. Activity-based product information for each treadmill is as follows: Activity Activity-Base Usage(hrs. per unit) X Activity Rateper Hour = Activity Cost Motor assembly 1.50 $20 $30.00 Final assembly 1.00 18 18.00 Testing 0.25 22 5.50 Rework 0.40 22 8.80 Moving 0.20 15 3.00 Activity cost per unit $65.30 All of the activity costs are related to labor. Management must remove $2.00 of activity cost from the product in order to remain competitive. Rework involves disassembling and repairing a unit that fails testing. Not all units require rework, but the average is 0.40 hours per unit. Presently, the testing is done on the completed assembly; but much of the rework has been related to motors, which can be tested independently prior to adding the motor…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax CollegeCornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage LearningManagerial Accounting: The Cornerstone of Busines...AccountingISBN:9781337115773Author:Maryanne M. Mowen, Don R. Hansen, Dan L. HeitgerPublisher:Cengage Learning
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College
Cornerstones of Cost Management (Cornerstones Ser...
Accounting
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Cengage Learning
Managerial Accounting: The Cornerstone of Busines...
Accounting
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Cengage Learning
What is variance analysis?; Author: Corporate finance institute;https://www.youtube.com/watch?v=SMTa1lZu7Qw;License: Standard YouTube License, CC-BY