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Tyler Fisher Accounting Presentation 4/29/2014. Assume that Timekiller, Inc., manufactures a new electronic game console. The current standard costs sheet.

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Presentation on theme: "Tyler Fisher Accounting Presentation 4/29/2014. Assume that Timekiller, Inc., manufactures a new electronic game console. The current standard costs sheet."— Presentation transcript:

1 Tyler Fisher Accounting Presentation 4/29/2014

2 Assume that Timekiller, Inc., manufactures a new electronic game console. The current standard costs sheet for a game console follows. Direct Materials? Kilograms@ $4/kilogram= ? Per game Direct Labor.25 hours@ ? /hour= ? Per game Overhead.25hours@ ?/hour= ? Per game TOTAL COSTS= $ 13.00/game Assume that the following data appeared in Timekiller’s records at the end of the past month: Please Note: There are no materials inventories. Actual production24,000 units Actual Sales15,000 units Materials (37,500 kgs)$157,500 Materials Price Variance7,500 U Materials Efficiency Variance6,000 U Direct Labor Price Variance4,560 U Direct Labor (5,700 hours)95,760 Underapplied overhead (Total)3,000 U

3 Required: A) Prepare a variance analysis for direct materials and direct labor and complete the standard cost sheet. B) Assume that all production overhead is fixed and that the $3,000 underapplied is the only overhead variance that can be computed. What are the actual and applied overhead amounts? (CPA adopted)

4 Setting up our chart (Actual Price X Actual Quantity) (= 157,500) Price Variance Efficiency Variance (Standard Price X Actual Quantity) ($4 X 37,500 = 150,000) (Standard Price X Standard Quantity) ($4 X )


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