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Question - Dixie Sporting Goods manufactures sleeping bags. The manufacturing standards per sleeping bag, based on 5,000 sleeping bags per month, are as follows:
Direct material of 5.50 yards at $5.20 per yard
Direct labor of 2.00 hours at $18.00 per hour
Overhead applied per sleeping bag at $19.00
In the month of April, the company actually produced 5,200 sleeping bags using 27,300 yards of material at a cost of $6.10 per yard. The labor used was 11,700 hours at an average rate of $20.50 per hour. The actual overhead spending was $96,200.
Required - Determine the labor rate variance and round to the nearest whole dollar.
What is the labor efficiency variance for March? (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable)
How would managers best interpret this outcome? At the end of April, the manufacturing overhead clearing account for Owens Company had a debit balance.
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Marigold has sufficient unused capacity to produce the 3400 units. If the special order is accepted, what will be the effect on net income?
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Assuming that variable costs are 30% and fixed costs are $100,000, what is the company's projected operating income if sales are $750,000?
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