Week 6 assignment
Question # 00023656
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Updated on: 08/20/2014 04:22 PM Due on: 08/25/2014
Problem 20-3 p620
Kolb Company prepared its income statements for the current year using three alternative cost accounting systems as follows:
Required:
Explain your answers to the following questions:
• a. Match the following cost systems with alternatives A, B, and C: (1) standard full cost system; (2) actual absorption cost system; and (3) actual variable cost system.
• b. How much, if any, of the factory overhead cost was variable?
• c. What was the actual factory overhead cost incurred for the year?
• d. What were the nonfactory costs incurred for the year?
• e. What percentage was actual factory volume for the year to normal factory volume?
• f. Which of the alternative statements was not prepared in accordance with generally accepted accounting principles?
• g. How did actual direct material cost compare with planned direct material cost?
• Problem 21-2 p643
Problem 21–2.
The Bradley Company has just completed its first year of operations. A condensed income statement follows, showing actual and standard amounts and the variances:
Required:
The president of Bradley Company has asked you as controller for the following data:
• a. How much of the variance in income was due to the fact that we sold less than expected of Product B and more of Product A?
• b. What would have happened to income if we had produced the number of units expected?
657 658
• c. What would have happened to the total gross margin variance if we had sold the number of units of both A and B that we expected to sell, but at the actual selling prices per unit?
• d. What is the variance due to the fact that actual selling prices were less than expected? (Product A sold for $5.50 per unit.)
Kolb Company prepared its income statements for the current year using three alternative cost accounting systems as follows:
Required:
Explain your answers to the following questions:
• a. Match the following cost systems with alternatives A, B, and C: (1) standard full cost system; (2) actual absorption cost system; and (3) actual variable cost system.
• b. How much, if any, of the factory overhead cost was variable?
• c. What was the actual factory overhead cost incurred for the year?
• d. What were the nonfactory costs incurred for the year?
• e. What percentage was actual factory volume for the year to normal factory volume?
• f. Which of the alternative statements was not prepared in accordance with generally accepted accounting principles?
• g. How did actual direct material cost compare with planned direct material cost?
• Problem 21-2 p643
Problem 21–2.
The Bradley Company has just completed its first year of operations. A condensed income statement follows, showing actual and standard amounts and the variances:
Required:
The president of Bradley Company has asked you as controller for the following data:
• a. How much of the variance in income was due to the fact that we sold less than expected of Product B and more of Product A?
• b. What would have happened to income if we had produced the number of units expected?
657 658
• c. What would have happened to the total gross margin variance if we had sold the number of units of both A and B that we expected to sell, but at the actual selling prices per unit?
• d. What is the variance due to the fact that actual selling prices were less than expected? (Product A sold for $5.50 per unit.)
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Solution: Week 6 assignment