Barley Hopp, Inc., manufactures custom-ordered commemorative beer steins. Its st

Question

Barley Hopp, Inc., manufactures custom-ordered commemorative beer steins. Its standard cost information follows Standard Standard Price Quantity 7 lbs1.80 per lb 2.1 hrs. $13.00 per hr. 2.1 hrs. 1.40 per hr Standard Unit Cost $ 3.06 27.30 2.94 (Rate) Direct materials (clay) Direct labor Variable manufacturing overhead (based on direct labor hours) Fixed manufacturing overhead ($209,100 + 2.55 82,000 units) Barley Hopp had the following actual results last year Number of units produced and sold Number of pounds of clay used Cost of clay Number of labor hours worked Direct labor cost Variable overhead cost Fixed overhead cost 112.600 190,000 S 313,500 152,600 S 688,600 S 180,600 295,000 Required Prepare the journal entry to record Barley Hopp's fixed manufacturing overhead costs and related variances for last year. (f no entry is required fora transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet Record the entry for fixed manufacturing overhead costs and variances Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry View general journal

Explanation / Answer

Fixed O/H Budget Variance :-

Budgeted O/H – Actual O/H

Budgeted O/H = $209100

Actual O/H = $295000

Budget Variance = 209100 – 295000 = $85900 (U)

Fixed O/H Volume Variance :-

Standard O/H – Budgeted O/H

O/H Recovery Rate = Budgeted OH / Budgeted units

     = 209100 / 82000 = $2.55

Standard O/H = Recovery rate * Actual Units

    = 2.55 * 112600 = $287130

Volume Variance = 287130 – 209100 = $78030 (F)

Transaction

General Journal

Debit

Credit

1

WIP Inventory (2.55 * 112600)

287130

Fixed O/H Budget Variance

85900

Fixed O/H Volume Variance

78030

Fixed O/H Exp

295000

Transaction

General Journal

Debit

Credit

1

WIP Inventory (2.55 * 112600)

287130

Fixed O/H Budget Variance

85900

Fixed O/H Volume Variance

78030

Fixed O/H Exp

295000

Related Questions

Navigate

• Browse (All)
• Browse B
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.