Principles of Cost Accounting
17th Edition
ISBN: 9781305087408
Author: Edward J. Vanderbeck, Maria R. Mitchell
Publisher: Cengage Learning
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Question
Chapter 8, Problem 15P
1.
To determine
Prepare the
1.
Expert Solution
Explanation of Solution
Prepare the journal entries to record the transactions.
Particulars | Debit($) | Credit($) |
Work in Process—Mixing | 4,400 | |
Materials Quantity Variance— Mixing | 200(1) | |
Materials Price Variance— Mixing | 115(1) | |
Materials | 4,715 | |
Work in Process-Blending | 1,900 | |
Materials Price Variance— Blending | 37(2) | |
Materials Quantity Variance—Blending | 50(2) | |
Materials | 1,813 | |
Factory overhead | 1,500 | |
Materials | 1,500 | |
Work in Process—Mixing | 22,000 | |
Labor Rate Variance— Mixing | 430(3) | |
Labor Efficiency Variance— Mixing | 500(3) | |
Payroll | 21,930 | |
Work in Process— Blending | 11,400 | |
Labor Efficiency Variance— Blending | 600(4) | |
Labor Rate Variance—Blending | 200(4) | |
Payroll | 11,800 | |
Factory overhead (indirect labor) | 2,300 | |
Payroll | 2,300 | |
Work in Process—Mixing | 6,600 | |
Factory Overhead—Flexible-Budget Variance— Mixing | 500(5) | |
Factory Overhead—Production-Volume Variance— Mixing | 400(5) | |
Factory Overhead— Mixing | 6,700 | |
Work in Process— Blending | 3,800 | |
Factory Overhead—Production-Volume Variance— Blending | 50(6) | |
Factory Overhead—Flexible-Budget Variance— Blending | 100(6) | |
Factory Overhead—Blending | 3,750 | |
Factory Overhead | 6,650 | |
Various Credits | 6,650 | |
Factory Overhead— Mixing | 6,700 | |
Factory Overhead— Blending | 3,750 | |
Factory Overhead | 10,450 | |
Work in Process— Blending | 30,000 | |
Work in Process— Mixing | 30,000 | |
Finished Goods | 43,200 | |
Work in Process—Dept. Blending | 43,200 | |
Accounts Receivable | 51,000 | |
Sales | 51,000 | |
Cost of Goods Sold | 40,800 | |
Finished Goods | 40,800 |
Table (1)
Working notes:
Variances are calculated as follows:
Materials:
- 1) Mixing:
Figure (1)
Equivalent units in mixing:
- 2) Blending:
Figure (2)
Equivalent units in blending:
Labor
- 3) Mixing:
Figure (3)
- 4) Blending:
Figure (4)
Factory overhead:
- 5) Mixing:
Figure (5)
- 6) Blending:
Figure (6)
2.
To determine
Calculate the ending balance of work-in process for every department.
2.
Expert Solution
Explanation of Solution
Calculate the ending balance of work-in process for mixing department.
Particulars | Amount($) |
Materials | 400 |
Labor | 2,000 |
Factory overhead | 600 |
Work-in process - Mixing | $3,000 |
Table (2)
Calculate the ending balance of work-in process for blending department.
Particulars | Amount($) | Amount($) |
Cost from mixing | $3,000 | |
Cost in blending: | ||
Materials | $100 | |
Labor | 600 | |
Factory overhead | 200 | 900 |
Work-in process - Blending | $3,900 |
Table (3)
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Chapter 8 Solutions
Principles of Cost Accounting
Ch. 8 - How does a standard cost accounting system work,...Ch. 8 - What is the difference between the standard cost...Ch. 8 - Prob. 3QCh. 8 - What are the specific procedures on which a...Ch. 8 - How are standards for materials and labor costs...Ch. 8 - What is a variance?Ch. 8 - How do price and quantity variances relate to...Ch. 8 - How do rate and efficiency variances relate to...Ch. 8 - Prob. 9QCh. 8 - How does a materials purchase price variance...
Ch. 8 - Prob. 11QCh. 8 - Prob. 12QCh. 8 - When a company uses a standard cost system, are...Ch. 8 - What two factors must be considered when breaking...Ch. 8 - What might cause the following materials...Ch. 8 - What might cause the following labor variances?
An...Ch. 8 - Prob. 17QCh. 8 - Prob. 18QCh. 8 - Prob. 19QCh. 8 - Prob. 20QCh. 8 - When does a flexible-budget variance occur?
Ch. 8 - Why is it important to determine flexible-budget...Ch. 8 - Prob. 23QCh. 8 - What is the significance of a production-volume...Ch. 8 - If production is more or less than the standard...Ch. 8 - At the end of the current fiscal year, the trial...Ch. 8 - What variances from the four-variance method are...Ch. 8 - What is the primary difference between the...Ch. 8 - What are the four variances in the four-variance...Ch. 8 - In all of the exercises involving variances, use F...Ch. 8 - Prob. 2ECh. 8 - Prob. 3ECh. 8 - Prob. 4ECh. 8 - Prob. 5ECh. 8 - Computing materials variances D-List Calendar Co....Ch. 8 - Computing labor variances LIFT Inc. manufactures...Ch. 8 - Standard cost summary; materials and labor cost...Ch. 8 - Computing labor variances Fill in the missing...Ch. 8 - Standard unit cost and journal entries The normal...Ch. 8 - Making journal entries Assume that during the...Ch. 8 - Using variance analysis and interpretation Last...Ch. 8 - Using variance analysis and interpretation Last...Ch. 8 - Journalizing standard costs in two departments...Ch. 8 - Calculating factory overhead The standard capacity...Ch. 8 - Determining Budgeted Overhead The overhead...Ch. 8 - Calculating factory overhead: two variances Munoz...Ch. 8 - Calculating factory overhead: two variances...Ch. 8 - The normal capacity of a manufacturing plant is...Ch. 8 - Calculating amount of factory overhead applied to...Ch. 8 - Georgia Gasket Co. budgets 8,000 direct labor...Ch. 8 - (Appendix) Calculating factory overhead: four...Ch. 8 - (Appendix) Calculating factory overhead: three...Ch. 8 - Materials and labor variances Branca Inspections...Ch. 8 - Materials and labor variances Fausto Fabricators...Ch. 8 - Zippy Inc. manufactures a fuel additive, Surge,...Ch. 8 - Calculation of materials and labor variances
Fritz...Ch. 8 - High-End Products Inc. uses a standard cost system...Ch. 8 - RDI Products Co. manufactures a variety of...Ch. 8 - The standard cost summary for the most popular...Ch. 8 - Carlo Lee Corp. has established the following...Ch. 8 - USD Inc. has established the following standard...Ch. 8 - Allocation of variances
Costa Brava Manufacturing...Ch. 8 - On May 1, Athens Inc. began the manufacture of a...Ch. 8 - The standard specifications for an electric motor...Ch. 8 - Cardiff Inc. manufactures men’s sport shirts for...Ch. 8 - Fargo Co. manufactures products in batches of 100...Ch. 8 - Prob. 15PCh. 8 - (Appendix) Overhead variances—four variance
Mobile...Ch. 8 - Shinto Corp. uses a standard cost system and...Ch. 8 - Kamen Manufacturing Co. estimates the following...Ch. 8 - Prob. 19PCh. 8 - Jillian Manufacturing Inc. manufactures a single...Ch. 8 - Cost and production data for Binghamton Beverages...
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What is variance analysis?; Author: Corporate finance institute;https://www.youtube.com/watch?v=SMTa1lZu7Qw;License: Standard YouTube License, CC-BY