Exam 13: Budgeting and Standard Costs

The standard costs and actual costs for direct materials, direct labor, and factory overhead for the manufacture of 2,500 units of product are as follows: Standard Costs Direct labor $\quad$$\quad$$\quad$$\quad$ 7,500 hours @ $\$ 12$ Actual Costs Direct labor $\quad$$\quad$$\quad$$\quad$ 7,400 hours $@ \$ 11.40$ ? The amount of the direct labor time variance is:

The master budget of a small manufacturer would normally include all necessary component budgets except the capital expenditures budget.

​A hotel has 50 suites in total, and the number of booked suites for the month of April is 20.Calculate the occupancy rate of suites of the hotel.

Production and sales estimates for May for the Hudson Co.are as follows: Estimated inventory (units), May 1 17,500 Desired inventory (unit), May 31 19,300 Expected sal es volume (units): Area W 4,200 Area X 7,000 Area Y 9,000 Unit sales price \ 15 ? The number of units expected to be sold in May is:

The first budget to be prepared is usually the production budget.

If the standard to produce a given amount of product is 1,000 units of direct materials at $11 and the actual was 800 units at $12, the direct materials price variance was $1,000 favorable.

If the standard to produce a given amount of product is 500 direct labor hours at $15 and the actual was 600 hours at $17, the rate variance was $1,200 favorable.

Frogue Corporation uses a standard cost system.The following information was provided for the period that just ended: Actual price per kilogram \ 2.50 Actual kilograms of material used 31,000 Actual hourly labor rate \ 18.10 Actual hours of production 4,900 labor hrs. Standard price per kilogram \ 2.80 Standard kilograms per completed unit 6 kilograms Standard hourly labor rate \ 18.00 Standard time per completed unit 1. Actual total factory overhead \ 34,900 Actual fixed factory overhead \ 18,000 Standard fixed factory overhead rate \ 1.20 per labor hour Standard variable factory overhead rate \ 3.80 per labor hour Maximum plant capacity 15,000 hours Units completed during the period 5,000 ? The direct materials cost variance is:

If the standard to produce a given amount of product is 900 units of direct materials at $11 and the actual was 800 units at $12, the direct materials quantity variance was $1,100 unfavorable.

Production estimates for August are as follows: Estimated inventory (units), August 1 3,000 Desired inventory (units), August 31 2,000 Expected sal es volume (units), August 40,000 For each unit produced, the direct materials requirements are as follows: Direct material A ( \ 2 per 1.) 5. Direct material B (\ 11 per 1.) 1. ? The number of pounds of materials A and B required for August production is:

Standard and actual costs for direct materials for the manufacture of 1,000 units of product were as follows: Actual costs 1,450@\ 8.10 Standard costs 1,500@\ 8.00 ? Determine the (a) quantity variance, (b) price variance, and (c) total direct materials cost variance.

Standards are more widely used for nonmanufacturing expenses than for manufacturing costs.

The standard costs and actual costs for direct labor for the manufacture of 2,500 actual units of product are as follows: Standard Costs Direct labor $\quad$$\quad$$\quad$$\quad$ 7,500 hours @ $\$ 12$ Actual Costs Direct labor $\quad$$\quad$$\quad$$\quad$ 7,400 hours $@ \$ 11.40$ ? The amount of the direct labor rate variance is:

Below is budgeted production and sales information for Octofic Cans, Inc.for the month of March: ? Aluminum Tin Estimated beginning inventory 12,000 units 6,000 units Desired ending inventory 15,000 units 4,000 units Region I, anticipated sales 380,000 units 85,000 units Region II, anticipated sales 125,000 units 25,000 units ? The unit selling price for aluminum cans is $0.15 and for tin cans is $0.20. Budgeted production for tin cans during the month is:

If the standard to produce a given amount of product is 600 direct labor hours at $17 and the actual was 500 hours at $15, the direct labor time variance was $1,700 favorable.

Kohlman Company began its operations on March 31 of the current year.Projected manufacturing costs for the first three months of business are $156,800, $195,200, and $217,600, respectively, for April, May, and June.Depreciation, insurance, and property taxes represent $28,800 of the estimated monthly manufacturing costs.Insurance was paid on March 31, and property taxes will be paid in November.Three-fourths of the remainder of the manufacturing costs are expected to be paid in the month in which they are incurred with the balance to be paid in the following month. The cash payments for manufacturing in the month of April are:

Currently attainable standards allow for unreasonable production difficulties.

Based on the following information, calculate process yield.? ? Units passing inspection 12,750 units Units entering process 15,000 units

If the standard to produce a given amount of product is 1,000 units of direct materials at $11 and the actual was 800 units at $12, the direct materials price variance was $800 favorable.

The treasurer of Unisyms Company has accumulated the following budget information for the first two months of the coming year: March April Sales \ 450,000 \ 520,000 Manufacturing costs 290,000 350,000 Selling and administrative expenses 41,400 46,400 Capital additions 250,000 - ? The company expects to sell about 35% of its merchandise for cash.Of sales on account, 80% are expected to be collected in full in the month of the sale and the remainder in the month following the sale.One-fourth of the manufacturing costs are expected to be paid in the month in which they are incurred and the other three-fourths in the following month.Depreciation, insurance, and property taxes represent $6,400 of the probable monthly selling and administrative expenses.Insurance is paid in February, and a $40,000 installment on income taxes is expected to be paid in April.Of the remainder of the selling and administrative expenses, one-half are expected to be paid in the month in which they are incurred, with the balance paid in the following month.Capital additions of $250,000 are expected to be paid in March. Current assets as of March 1 are composed of cash of $45,000 and accounts receivable of $51,000.Current liabilities as of March 1 are composed of accounts payable of $121,500 ($102,000 for materials purchases and $19,500 for operating expenses).Management desires to maintain a minimum cash balance of $20,000. Prepare a monthly cash budget for March and April.