You have just been hired by SecuriDoor Corporation, the manufacturer of a revolu
ID: 2375458 • Letter: Y
Question
You have just been hired by SecuriDoor Corporation, the manufacturer of a revolutionary new garage door opening device. The president has asked that you review the company%u2019s costing system and %u201Cdo what you can to help us get better control of our manufacturing overhead costs.%u201D You find that the company has never used a flexible budget, and you suggest that preparing such a budget would be an excellent first step in overhead planning and control.
After much effort and analysis, you determined the following cost formulas and gathered the following actual cost data for April:
During April, the company worked 20,000 machine-hours and produced 14,000 units. The company had originally planned to work 22,000 machine-hours during April.
Prepare a flexible budget for April. (Input all amounts as positive values.)
Prepare a report showing the spending variances for April. (Input all amounts as positive values. Leave no cells blank - be certain to enter "0" wherever required. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)
You have just been hired by SecuriDoor Corporation, the manufacturer of a revolutionary new garage door opening device. The president has asked that you review the company%u2019s costing system and %u201Cdo what you can to help us get better control of our manufacturing overhead costs.%u201D You find that the company has never used a flexible budget, and you suggest that preparing such a budget would be an excellent first step in overhead planning and control.
After much effort and analysis, you determined the following cost formulas and gathered the following actual cost data for April:
Explanation / Answer
flexible budget
====================================================================================================================================================== machine hours 20000
======================================================================================================================================================Utilities 18 900
======================================================================================================================================================maintenance 76900
======================================================================================================================================================supplies 8000
======================================================================================================================================================iindirect labor 128 400
======================================================================================================================================================Depreciation 68,200
======================================================================================================================================================
total 300400
======================================================================================================================================================
actual
variance
Utilities
18 900
20,980
- 2080
Maintenance
76900
74,500
2400
Supplies
8000
8,600
-600
Indirect labor
128 400
132,700
-4300
Depreciation
68,200
69,900
-1700
FlexibleBudgetactual
variance
Utilities
18 900
20,980
- 2080
Maintenance
76900
74,500
2400
Supplies
8000
8,600
-600
Indirect labor
128 400
132,700
-4300
Depreciation
68,200
69,900
-1700
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