Accounting Problems Set of 11 Questions

1) The president of the company, Max Best, has come to you for help. Use the following data to prepare a flexible budget for possible sales/production levels of 10,000, 11,000, and 12,000 units. Show the contribution margin at each activity level.Sales price $24 per unitVariable costs:Manufacturing $12 per unitAdministrative $ 3 per unitSelling $ 1 per unitFixed costs:Manufacturing $60,000Administrative $20,0002) Able Company manufactures tables for schools. The 2015 operating budget is based on sales of 44,000 units at $55 per table. Operating income is anticipated to be $132,000. Budgeted variable costs are $35 per unit, while fixed costs total $660,000.Actual income for 2015 was a surprising $477,000 on actual sales of 46,000 units at $57 each. Actual variable costs were $33 per unit and fixed costs totaled $627,000.Required:Prepare a variance analysis report with both flexible-budget and sales-volume variances.3) The following data for the Campbell Company pertains to the production of 2,000 garden spades during March. The spade consists of a wooden handle and a metal forged tool that comes in contact with the ground.Direct Materials (all materials purchased were used):Standard cost: $1.00 per handle and $3.00 per metal tool.Total actual cost: $9,000.Materials flexible-budget efficiency variance was $500 unfavorable.Direct Manufacturing Labor:Standard cost is 5 garden spades per hour at $20.00 per hour.Actual cost per hour was $21.00.Labor efficiency variance was $500 favorable.Required:a. What is the standard direct material amount per garden spade?b. What is the standard cost allowed for all units produced?c. What is the total direct materials flexible-budget variance?d. What is the direct material flexible-budget price variance?e. What is the total actual cost of direct manufacturing labor?f. What is the labor price variance for direct manufacturing labor?4) Delk Company makes separate journal entries for all cost accounting-related activities. It uses a standard cost system for all manufacturing items. For the month of June, the following activities have taken place:Direct Manufacturing Materials Purchased $300,000Direct Manufacturing Materials Used 250,000Direct Materials Price Variance 10,000 unfavorable(at time of purchase)Direct Materials Efficiency Variance 15,000 favorableDirect Manufacturing Labor Price Variance 6,000 favorableDirect Manufacturing Labor Efficiency Variance 4,000 favorableDirect Manufacturing Labor Payable 170,000Required:Record the necessary journal entries to close the accounts for the month.5) Evans Inc. manufactures pillows. The 2015 operating budget is based on production of 25,000 pillows with 0.75 machine-hour allowed per pillow. Budgeted variable overhead per hour was $25.Actual production for 2015 was 27,000 pillows using 19,050 machine-hours. Actual variable costs were $23 per machine-hour.Required:Calculate the variable overhead spending and efficiency variances.6) Farmer Inc. makes clocks. The fixed overhead costs for 2015 total $880,000. The company uses direct labor-hours for fixed overhead allocation and anticipates 220,000 hours during the year for 330,000 units. An equal number of units are budgeted for each month.During June, 32,000 clocks were produced and $72,000 was spent on fixed overhead.Required:a. Determine the fixed overhead rate for 2015 based on units of input.b. Determine the fixed overhead static-budget variance for June.c. Determine the production-volume overhead variance for June.7) Green has budgeted construction overhead for August of $260,000 for variable costs and $435,000 for fixed costs. Actual costs for the month totaled $275,000 for variable and $445,000 for fixed. Allocated fixed overhead totaled $440,000. The company tracks each item in an overhead control account before allocations are made to individual jobs. Spending variances for August were $10,000 unfavorable for variable and $10,000 unfavorable for fixed. The production-volume overhead variance was $5,000 favorable.Required:a. Make journal entries for the actual costs incurred.b. Make journal entries to record the variances for August.8)Haines Company sells its products for $33 each. The current production level is 50,000 units, although only 40,000 units are anticipated to be sold.Unit manufacturing costs are:Direct materials $6.00Direct manufacturing labor $9.00Variable manufacturing costs $4.50Total fixed manufacturing costs $180,000Marketing expenses $3.00 per unit, plus $100,000 per yearRequired:a. Prepare an income statement using absorption costing.b. Prepare an income statement using variable costing.9) Ickle Company produces a specialty statue item. The following information has been provided by management:Actual sales 10,000 unitsBudgeted production 12,000 unitsSelling price $425 per unitDirect material costs $87.50 per unitFixed manufacturing costs $62.50 per unitVariable manufacturing costs $50.00 per unitVariable administrative costs $25.00 per unitRequired:a. What is the cost per statue if absorption costing is used?b. What is the cost per statue if “super-variable costing” is used?c. What is the total throughput contribution?10) The James Inc. has provided the following information:Units of Output 33,000 Units 46,200 UnitsDirect materials $ 316,800 $ 443,520Workers’ wages 1,188,000 1,663,200Supervisors’ salaries 343,200 343,200Equipment depreciation 166,320 166,320Maintenance 89,760 121,440Utilities 422,400 580,800Total $2,526,480 $3,318,480Using the high-low method and the information provided above,a. identify the linear cost function equation (be sure to variable and fixed components in the equation)b. estimate the total cost at 38,000 units of output.11)What are the three criteria a company should use to evaluate and choose a cost driver? Briefly explain each of the three criteria.