Standard Costs – Part 2 – 11-16

Standard Costs – Part 2 – 11-16.  Remaining problem numbers for Part 1.  Need in excel. 

4{7113 Axrigrrnent PrintMav

11.
Problem 21-3A Part 3

3. The company’s business conditions are impmling. One prrssible result is a sales \olume of
approximately 18,fi)0 units. The company president is confident that this \plume is within the rcle\Bnt
range of existing capacity. Hor,v much \ilould operating income il:crease orgr the 2011 budgeled amount
of $379,000 if lhis lercl is reached without increasing capacity? {Do not round intermediate
calculatione, Omit the “$” sign in your reryon*.)

Operating income increase $

ldVorksheet

Fra$leni ?f -34 Parf 3

Learning ilbjective: 21-F1 Prepare a *exible budget
and interpret a flexible budget perf*rmance report.

Difficulty Mediurn

12.

Probfem 21-3A Part 4
4. An unhrcrable change in business is rcmotely possible; in this case, pDduction and sales rolume br

2011 could fall to 12,000 units. Ho,v much income (or loss) tom operations would occur if sales \Dlume
hlls to this lelel? flnput the amount as positive value. Do nol round intermediate calculations
Omit the ‘$” dgn in your response.)

ffi$_

Worksheet

Pr*bJem ?1-34 Part 4 Learning Object r{}: 21-P1 Prepsre a flexible budget
and interpret a flr:xible budget performance repor”t.

Problem 21-5A Flexible budget preparation; computatian af mateilals, labar, and overhead wriances: and overhead variance repart L.Q. Pl, P2,
P3, C2
[fhe fallowing intomalian applies b the guestions dlsplayed belowJ

Kwikeee Cornpany set the following standard costs br one unit of its product.

Direct matedals {{3.0 hs. @ $+.o per h.) $ 12.0

0

Dir€ctlabor(1.5hrs. @$14.0perhr.) 21.0O
Orerhead (1.5 hns. @ $18.50 perhr.) 27.75
Total sfandard cost $ 60.75

The F€detemined o\,ethead rate ($18.50 psr direct labor hour) is basr:d on an expected wlume of 75% of
the factory’s capacity of 20,000 units pet month. Fdlowing are the conrpany’s budgeted oerhead costs per
month at the 75% le\el-

Owrhead Budget (75% Capacity)
Variable owrhead costs

lndirect materials
lndirect labor

Power
Repairs and maintenance

Total wriable orerhead costs
Fixed o\,erhead costs

Depreciation*buil di ng
Depreciiltion*rn acni n ery
Taxes and insufiance
Supenisrion

Total fixed overhead cost$

Total ow*rcad costs

sto. rrhecl oud. nng ranA hi I I . cory?rntpx

$

15,000

75,000

15,000

30,000

$ 135,000

24,440
70,ooa
20,000

167,250

?,81,?:50

$ 416,250

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13,

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eeto. nfted u.d.nug ru*,i,, .conr/trm.px
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The com4nt incuned the fullarrrdng actual costs ufien it operated at

nmffiPrintMerr

6 capcity in fttober,

195,300
443,300

57S,250

of each wriable and fixed cost at
amqunt per unit ansrers to 2

COMPANY
Oterhead Budgets

Ended Oct$er 31
ble Budget

$ 43,250
176,500
17,zffi
34,500
24,OW
94,500
19,000

167,250

Total castls

__ L -__.-
I

I

$ection Brpak
I

1,213,950

Problam 21-5A b le b udget preparatian ;
campufutian af m ials, Iab or, and averhead
yanances,’and o
P3, C2

d van’ance rcport L.A. Pf, P2,

Vadable
Amount
per Unit

Total
Fixed
Cost

Flexible Budget
ftr Unit Sales

of 13,000

FlexiHe Budget
br Unit $ales

of 15,000

|.”*.,..”‘”-.”.
$i “_- – ;

a*–“-“*- –*-i
”’.’–” ‘-,.. .!

i’-‘ — ‘. *”i
ir

i!
.” ..-… -. -l

t*’**-.””‘^-**^–‘-*^’*-1
l:

ii

Flexible Budget
for Unit Sales

of 17,000

$- “.
i

i– – — “*i

i*^–‘**-“”‘*–”*–‘i ;”**’**'”‘^*’*-*'”**-“-‘*i
:,t;’:
i-.f*-.-,,*-.–,,–*–* …,*..–.,.,-” -., -;!

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j. l

t^-.””.,”,.-
“…-.”..”.-….. . “-_..,,._.. _” _. :::

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ii
.i…*…-,””….”,”””*…*,..,.”..,.,…,-,…,-.,.,…,-.”..i::
i,- .-.- -“‘– i

$ i”_:- :
-:-:

$ i:::”_-:-::_j $ i :::. _: ::-:-j

Leaming Objectiw : 21 -?3 Campute ausrhead
vartances.

I

Problem 21-5A Paft 2
I

I

toial rsriaHe costs

fotaflornrhead costs

Aft113 As$ig nrnent Pfint Mew

Prablem 21-SA Pad 3
3. Compute the direct mat€rials c6t \Edance, including lts pric’!, and quantity rariances.{lndicate the

effec’t of each variance by selecling “F” for favorable, “U” for unfavorable, and “None” for no
etr€Et {i-e., zero variance}. lnput all amounts as posilive values Leave no calls blank – be
certain to enter “0” wherever required. Omit the .$. dgn irr your response,)

Direct materials cest \rariance $ o ll-a :*.-_*T.’l

l+,

Pric;e rariance

Quantity variance

Worksheet

Prob l*m 21 -fiA Part 3

iir !* rrn ‘ ‘ -” “*::+’ :tC Learning Objectiw: ?1-p3 ComBute ovsrhsad
\Eriances.

.-. n rl.-. –,!! lu

Problem 21-SA Part 4
4. Compute the dircct labor cost \€dance, including its rate and e{liciency \adances.(lhdicate the effect

of each variance by selecting “F* for favorable, “U” for unrfay6pS;”, and “None” for no efecd
{i.e., zero variancei. lnput all amounts as positave valueg i..eave no e*lls blank – be certain to
enter “0” wherever required, Omit the ”

Directlaborcostrariance $ o [E-]T:l:lFl
Raterariance $, o, IU-.., -lT-Jl
Effciency\adance $ o

-‘-t,

Worksheet Leaming Obie6li\le: 21-C2 Describe lariances and Leamlng Obiectile: 21-P3 Csmpute ot€rhead
whattheyre\€al aboutperformance. \4ariances.

problem21-SApad4 LearningObjectite:21-P1 Prepare af,exiblebudget
and inlerprei a ir:rxible budget performance report.

Leaming Objecti,e: 21-P2 Compule materials and
labor \,ariances.

t
L
lr
lg ‘- – .*… ,e.. … .

15.

16.

Problem 21-5A Part 5
5. Prepare a detailed owrtead \ariance report that shorvs the \,ariiinces br indilidual items of orerhead.

{Leave no cells blank – be certain lo enter “0” rrherever nrquired. tndicate the effeet of each
variance by sel€cding “F” for favorable, ‘U” for unfayorable, and “None” for no effect {i,e., zero
variance). lnpul all amounts as positive values, Omit the

KWIKEZE CC,rtu1P461″
Owrhead Varial,ice Report

For Month Ended October 31

% of capacity

% of capacity

ffi
Flelible Fj.fdget ,Agtug,l, Re$illfs Vgrianpes

ffiE:.’o”g.’o..

Volurrne Variance

Expected production level

Production lewl achiered

Volume rariance

Contrdlable Variance
Varierble owrhead costs

hrrdircet labor i’r

E
irs and mgintenance ‘ lv

00
0 .’ 0

o. offi
Tol;al wriable costs

ezto. nfiecl oud. rrcg ravrr hi I I .con/trm.tpx

0

91fi

4nn3

otrerhead costs

fixed cmts

2’t -#A Parl 5

i,*::::ji
i””**”***”
L _*”*__ gj

il_:: _:_ pj
i””_-“*”____ 9.i

ffiPrirfrManr

i*__)i_:
i-:—e:i
t*:—–pj

‘._-_:::”:_p_i

;::* n
i:_ ::*:ei
L —–:—qi
r*-__ _9i
i*’^ – “*

*- *-“- *”*”*-*’*’i

i” — — -“- –9j

W
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ffi
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Learning Obj : 21-C2 Describe rmriances and
what they rew pertar*r*nce.

Leaming Obj e:21-FI Prepare *frexble budget
xible budget performance reporl.and inlerpreta

Learning Obj
lablluri:nc€s:

Learning Objectiw: 21 -P3 Compute e\Erhead
rariances.

: 21-P2 Compute ma8rials and

sto.rrheclffrd.mcg ll.cornllunpx 1tr10

dgn in your resp,:rnse.)

Directlaborcostrariance $ o [E-]T:l:lFl
Raterariance $, o, IU-.., -lT-Jl
Effciency\adance $ o
-‘-t,
Worksheet Leaming Obie6li\le: 21-C2 Describe lariances and Leamlng Obiectile: 21-P3 Csmpute ot€rhead
whattheyre\€al aboutperformance. \4ariances.
problem21-SApad4 LearningObjectite:21-P1 Prepare af,exiblebudget
and inlerprei a ir:rxible budget performance report.
Leaming Objecti,e: 21-P2 Compule materials and
labor \,ariances.
t
L
lr
lg ‘- – .*… ,e.. … .
15.
16.
Problem 21-5A Part 5
5. Prepare a detailed owrtead \ariance report that shorvs the \,ariiinces br indilidual items of orerhead.
{Leave no cells blank – be certain lo enter “0” rrherever nrquired. tndicate the effeet of each
variance by sel€cding “F” for favorable, ‘U” for unfayorable, and “None” for no effect {i,e., zero
variance). lnpul all amounts as positive values, Omit the
KWIKEZE CC,rtu1P461″
Owrhead Varial,ice Report
For Month Ended October 31
% of capacity
% of capacity
ffi
Flelible Fj.fdget ,Agtug,l, Re$illfs Vgrianpes
ffiE:.’o”g.’o..$’9tU.–*__ln
Volurrne Variance
Expected production level
Production lewl achiered
Volume rariance
Contrdlable Variance
Varierble owrhead costs
hrrdircet labor i’r
E
irs and mgintenance ‘ lv
00
0 .’ 0
o. offi
Tol;al wriable costs
ezto. nfiecl oud. rrcg ravrr hi I I .con/trm.tpx
0
91fi

4nn3
otrerhead costs
fixed cmts
2’t -#A Parl 5
i,*::::ji
i””**”***”
L _*”*__ gj
il_:: _:_ pj
i””_-“*”____ 9.i
ffiPrirfrManr
i*__)i_:
i-:—e:i
t*:—–pj
‘._-_:::”:_p_i
;::* n
i:_ ::*:ei
L —–:—qi
r*-__ _9i
i*’^ – “*
*- *-“- *”*”*-*’*’i
i” — — -“- –9j
W
ffi
ffi
ffi
ffi
W
Learning Obj : 21-C2 Describe rmriances and
what they rew pertar*r*nce.
Leaming Obj e:21-FI Prepare *frexble budget
xible budget performance reporl.and inlerpreta
Learning Obj
lablluri:nc€s:
Learning Objectiw: 21 -P3 Compute e\Erhead
rariances.
: 21-P2 Compute ma8rials and
sto.rrheclffrd.mcg ll.cornllunpx 1tr10

9tU.–*__ln

Volurrne Variance
Expected production level
Production lewl achiered
Volume rariance
Contrdlable Variance
Varierble owrhead costs
hrrdircet labor i’r
E
irs and mgintenance ‘ lv
00
0 .’ 0
o. offi
Tol;al wriable costs
ezto. nfiecl oud. rrcg ravrr hi I I .con/trm.tpx
0
91fi

4nn3
otrerhead costs
fixed cmts
2’t -#A Parl 5
i,*::::ji
i””**”***”
L _*”*__ gj
il_:: _:_ pj
i””_-“*”____ 9.i
ffiPrirfrManr
i*__)i_:
i-:—e:i
t*:—–pj
‘._-_:::”:_p_i
;::* n
i:_ ::*:ei
L —–:—qi
r*-__ _9i
i*’^ – “*
*- *-“- *”*”*-*’*’i
i” — — -“- –9j
W
ffi
ffi
ffi
ffi
W
Learning Obj : 21-C2 Describe rmriances and
what they rew pertar*r*nce.
Leaming Obj e:21-FI Prepare *frexble budget
xible budget performance reporl.and inlerpreta
Learning Obj
lablluri:nc€s:
Learning Objectiw: 21 -P3 Compute e\Erhead
rariances.
: 21-P2 Compute ma8rials and
sto.rrheclffrd.mcg ll.cornllunpx 1tr10

dgn in your resp,:rnse.)

Directlaborcostrariance $ o [E-]T:l:lFl
Raterariance $, o, IU-.., -lT-Jl
Effciency\adance $ o
-‘-t,
Worksheet Leaming Obie6li\le: 21-C2 Describe lariances and Leamlng Obiectile: 21-P3 Csmpute ot€rhead
whattheyre\€al aboutperformance. \4ariances.
problem21-SApad4 LearningObjectite:21-P1 Prepare af,exiblebudget
and inlerprei a ir:rxible budget performance report.
Leaming Objecti,e: 21-P2 Compule materials and
labor \,ariances.
t
L
lr
lg ‘- – .*… ,e.. … .
15.
16.
Problem 21-5A Part 5
5. Prepare a detailed owrtead \ariance report that shorvs the \,ariiinces br indilidual items of orerhead.
{Leave no cells blank – be certain lo enter “0” rrherever nrquired. tndicate the effeet of each
variance by sel€cding “F” for favorable, ‘U” for unfayorable, and “None” for no effect {i,e., zero
variance). lnpul all amounts as positive values, Omit the
KWIKEZE CC,rtu1P461″
Owrhead Varial,ice Report
For Month Ended October 31
% of capacity
% of capacity
ffi
Flelible Fj.fdget ,Agtug,l, Re$illfs Vgrianpes
ffiE:.’o”g.’o..$’9tU.–*__ln
Volurrne Variance
Expected production level
Production lewl achiered
Volume rariance
Contrdlable Variance
Varierble owrhead costs
hrrdircet labor i’r
E
irs and mgintenance ‘ lv
00
0 .’ 0
o. offi
Tol;al wriable costs
ezto. nfiecl oud. rrcg ravrr hi I I .con/trm.tpx
0
91fi

4nn3
otrerhead costs
fixed cmts
2’t -#A Parl 5
i,*::::ji
i””**”***”
L _*”*__ gj
il_:: _:_ pj
i””_-“*”____ 9.i
ffiPrirfrManr
i*__)i_:
i-:—e:i
t*:—–pj
‘._-_:::”:_p_i
;::* n
i:_ ::*:ei
L —–:—qi
r*-__ _9i
i*’^ – “*
*- *-“- *”*”*-*’*’i
i” — — -“- –9j
W
ffi
ffi
ffi
ffi
W
Learning Obj : 21-C2 Describe rmriances and
what they rew pertar*r*nce.
Leaming Obj e:21-FI Prepare *frexble budget
xible budget performance reporl.and inlerpreta
Learning Obj
lablluri:nc€s:
Learning Objectiw: 21 -P3 Compute e\Erhead
rariances.
: 21-P2 Compute ma8rials and
sto.rrheclffrd.mcg ll.cornllunpx 1tr10

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