Discuss about calculation of planned and actual production

Assignment Help Accounting Basics

Reference no: EM13824551

Problem-

Your next-door neighbor recently began a new job as assistant controller for Conundrum Corporation. As her first assignment, she prepared a performance report for January. She was scheduled to present the report to management the next morning, so she brought it home to review. As the two of you chatted in the backyard, she decided to show you the report she had prepared. Unfortunately, your dog thought the report was an object to be fetched. The pup made a flying leap and got a firm grip on the report. After chasing the dog around the block, you managed to wrest the report from its teeth. Needless to say, it was torn to bits. Only certain data are legible on the report. This information follows:

CONUNDRUM CORPORATION Performance Report For the Month of January
	Direct Material	Direct Labour	Variable Overhead	Fixed Overhead
Standard allowed cost given actual output	? (? kilograms at $12per kilogram)	? (2 hours at $14 per hour)
Flexible overhead budget			?	$40000
Actual cost	$191000 (14000 kilograms at $13.5 per kilogram)	? (8800 hours at ? per hour)	?	?
Direct material price variance	?
Direct material quantity variance	$6000U
Direct labor rate variance		$8800U
Direct labor efficiency variance		2800F
Variable-overhead spending variance			$2670U
Variable-overhead efficiency variance			800F
Fixed-overhead budget variance				$3450U
Fixed-overhead volume variance				?

In addition to the fragmentary data still legible on the performance report, your neighbor happened to remember the following facts.

Planned production of Conundrum's sole product was 500 units more than the actual production.
All of the direct material purchased in January was used in production.
There were no beginning or ending inventories.
Variable and fixed overhead are applied on the basis of direct labor hours. The fixed overhead rate is $4 per hour.

Required:

Feeling guilty, you have agreed to help your neighbor reconstruct the following facts, which will be necessary for her presentation. Indicate whether the variance is favorable or unfavorable.(Round "Actual variable-overhead rate" to 2 decimal places. Select "None" for no effect (i.e., zero variance). Input all amounts as positive values. Do not round your intermediate calculations.)

1. Planned production (in units). ______

2. Actual production (in units). ________

3. Actual fixed overhead. $. ________

4. Total standard allowed direct labor hours. ________

5. Actual direct labor rate. $. _________

6. Standard variable-overhead rate. $. _________

7. Actual variable-overhead rate. $. _________

8. Standard direct material quantity per unit. _________

9. Direct material price variance. $. _________

10. Applied fixed overhead. $. _________

11. Fixed-overhead volume variance. $. __________

Additional information-

The problem relates to Basic Accounting and it discuss about calculation of planned production, actual production, actual fixed overhead, total standard allowed direct labor hours, actual direct labor rate, direct material price variance, etc and more.

Reference no: EM13824551

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