Question 1: In November 2008, Day time Publishing Company's cost and quantities of paper consumed in manufacturing its 2009 Executive Planner and Calendar as follows:
Actual Unit Purchase Price 0.0065 per page
Standard unit price 0.070 per page
Standard quality for good production 195,800
Actual quantity purchased during November 230,000
Actual quantity used in November 200,000
a. Calculate the total cost of purchase for November.
b. Compute the material price variance(based on quantity purchased)
c. Calculate the material quantity variance.
Question 2: Joy Ride Corporation has fully automated production facility in which almost 97 percent of overhead costs are driven by machine hours. As the company's cost accountant, you have computed the following overhead variances for May:
The company president is concerned about the variance amounts and has asked you to show her how the variances were computed and to answer several questions.Budgeted fixed overhead for the month is 500,000 the predetermined variable and fixed overhead rates are respectively 10,and 20 per machine hour.Budgeted capacity of 10,000.
a. Using the four variances approach prepares an overhead analysis in much detail as possible.
b. What is the standard number of machine hours allowed for each unit of output?
c. How many actual hours were worked in May?
d. What is the total spending variance?
e. How would the overhead variances be closed if the three variance approach was used?
Question 3: In one joint process, Hardahl Chemical produces three joint products and one by -product. The following information is available for September 2008:
Product - Gallons - Sales Value at Split off per gallon- Cost after Split-Off - Final Selling price
JP-4539 4,000 $12 $3 21
JP-4587 16,000 $8 5 14
Jp-4591 12,000 15 2 19
Allocate the joint cost of 465,000 to the production based on the
a. Number of gallons b. Sales value at split-off and c. Approximated net realizable values at split-off.
Question 4: Washington Cannery makes three products from a single joint process. For 2008, the cannery processed all three products beyond split off. The following data were generated for the year:
Joint Product Incremental Separate Costs Total Revenue
Candied Apples 26,000 620,000
Apple Jelly 38,000 740,000
Apple Jam 15,000 270,000
Analysis of the 2008 market data reveals that candied apple, apple jelly and apple jam, could have been sold at split-off for 642,000,706,000 and 253,000 respectively.
A.Based on hindsight, evaluate managements production decisions in 2008.
B.How much additional profit could the company have generated in 2008 if it had made optimal decision at split-off?