Managerial Accounting 10.4 , assignment help

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4. value: 7.00 points Miller Toy Company manufactures a plastic swimming pool at its Westwood Plant. The plant has been experiencing problems as shown by its June contribution format income statement below: Budgeted Sales (4,000 pools) $ Actual 210,000 $ 210,000 Variable expenses: Variable cost of goods sold* Variable selling expenses 50,680 63,710 12,000 12,000 Total variable expenses 62,680 75,710 147,320 134,290 61,000 61,000 76,000 76,000 137,000 137,000 Contribution margin Fixed expenses: Manufacturing overhead Selling and administrative Total fixed expenses Net operating income (loss) $ 10,320 $ (2,710) *Contains direct materials, direct labor, and variable manufacturing overhead. Janet Dunn, who has just been appointed general manager of the Westwood Plant, has been given instructions to “get things under control.” Upon reviewing the plant’s income statement, Ms. Dunn has concluded that the major problem lies in the variable cost of goods sold. She has been provided with the following standard cost per swimming pool: Direct materials Direct labor Variable manufacturing overhead Standard Standard Quantity or Price Hours or Rate 3.7 2.10 per $ pounds pound 6.70 per 0.6 hours $ hour 2.20 per 0.4 hours* $ hour Total standard cost Standard Cost $ 4.02 0.88 $ Page 1 7.77 12.67 *Based on machine-hours. During June the plant produced 4,000 pools and incurred the following costs: a. Purchased 19,800 pounds of materials at a cost of $2.55 per pound. b. Used 14,600 pounds of materials in production. (Finished goods and work in process inventories are insignificant and can be ignored.) c. Worked 3,000 direct labor-hours at a cost of $6.40 per hour. d. Incurred variable manufacturing overhead cost totaling $4,940 for the month. A total of 1,900 machinehours was recorded. It is the company’s policy to close all variances to cost of goods sold on a monthly basis. Required: 1. Compute the following variances for June: a. Materials price and quantity variances. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).) b. Labor rate and efficiency variances. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).) c. Variable overhead rate and efficiency variances. (Do not round your intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).) 2. Summarize the variances that you computed in (1) above by showing the net overall favorable or unfavorable variance for the month. (Input all values as positive amounts. Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).) Page 2 3. Pick out the two most significant variances that you computed in (1) above. (You may select more than one answer. Single click the box with a check mark for correct answers and double click to empty the box for the wrong answers.) Materials price variance Labor efficiency variance Variable overhead efficiency variance Labor rate variance Variable overhead rate variance Materials quantity variance Page 3 ...
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Tutor went the extra mile to help me with this essay. Citations were a bit shaky but I appreciated how well he handled APA styles and how ok he was to change them even though I didnt specify. Got a B+ which is believable and acceptable.

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