Exam 25: Standard Cost Systems: a Financial Reporting Perspective Using Microsoft Excel

Millonzi Corporation manufactures one product.It does not maintain any beginning or ending Work in Process inventories.The company uses a standard cost system in which inventories are recorded at their standard costs and any variances are closed directly to Cost of Goods Sold.There is no variable manufacturing overhead.The company's balance sheet at the beginning of the year was as follows: The standard cost card for the company's only product is as follows: The company calculated the following variances for the year: The standard fixed manufacturing overhead rate was based on budgeted fixed manufacturing overhead of $236,250 and budgeted activity of 13,500 hours. During the year,the company completed the following transactions: a.Purchased 21,000 liters of raw material at a price of $8.70 per liter. b.Used 19,510 liters of the raw material to produce 5,300 units of work in process. c.Assigned direct labor costs to work in process.The direct labor workers (who were paid in cash)worked 4,570 hours at an average cost of $19.70 per hour. d.Applied fixed overhead to the 5,300 units in work in process inventory using the predetermined overhead rate multiplied by the number of direct labor-hours allowed.Actual fixed overhead costs for the year were $225,150.Of this total,$165,150 related to items such as insurance,utilities,and indirect labor salaries that were all paid in cash and $60,000 related to depreciation of manufacturing equipment. e.Transferred 5,300 units from work in process to finished goods. f.Sold for cash 5,500 units to customers at a price of $108.90 per unit. g.Completed and transferred the standard cost associated with the 5,500 units sold from finished goods to cost of goods sold. h.Paid $27,000 of selling and administrative expenses. i.Closed all standard cost variances to cost of goods sold. Required: 1.Enter the beginning balances and record the above transactions in the worksheet that appears below.Because of the width of the worksheet,it is in two parts.In your text,these two parts would be joined side-by-side to make one very wide worksheet. 2.Determine the ending balance (e.g.,12/31 balance)in each account.

Ester Corporation manufactures one product. It does not maintain any beginning or ending Work in Process inventories. The company uses a standard cost system in which inventories are recorded at their standard costs. There is no variable manufacturing overhead. The standard cost card for the company's only product is as follows: The standard fixed manufacturing overhead rate was based on budgeted fixed manufacturing overhead of $168,000 and budgeted activity of 24,000 hours. During the year, the company applied fixed overhead to the 22,600 units in work in process inventory using the predetermined overhead rate multiplied by the number of direct labor-hours allowed. Actual fixed overhead costs for the year were $149,800. Of this total, $83,800 related to items such as insurance, utilities, and indirect labor salaries that were all paid in cash and $66,000 related to depreciation of manufacturing equipment. Assume that all transactions are recorded on the below worksheet, which is similar to the worksheet shown in your text except that it has been divided into two parts so that it fits on one page. The beginning balances in each of the accounts have been given. PP&E (net) stands for Property, Plant, and Equipment net of depreciation. -When applying fixed manufacturing overhead to production,the Work in Process inventory account will increase (decrease)by:

Gathman Corporation manufactures one product.It does not maintain any beginning or ending Work in Process inventories.The company uses a standard cost system in which inventories are recorded at their standard costs and any variances are closed directly to Cost of Goods Sold.There is no variable manufacturing overhead.The company's balance sheet at the beginning of the year was as follows: The standard cost card for the company's only product is as follows: The standard fixed manufacturing overhead rate was based on budgeted fixed manufacturing overhead of $117,000 and budgeted activity of 18,000 hours. During the year,the company completed the following transactions: a.Purchased 36,300 pounds of raw material at a price of $4.70 per pound. b.Used 32,100 pounds of the raw material to produce 12,800 units of work in process. c.Assigned direct labor costs to work in process.The direct labor workers (who were paid in cash)worked 12,520 hours at an average cost of $21.00 per hour. d.Applied fixed overhead to the 12,800 units in work in process inventory using the predetermined overhead rate multiplied by the number of direct labor-hours allowed.Actual fixed overhead costs for the year were $132,700.Of this total,$27,700 related to items such as insurance,utilities,and indirect labor salaries that were all paid in cash and $105,000 related to depreciation of manufacturing equipment. e.Transferred 12,800 units from work in process to finished goods. f.Sold for cash 12,600 units to customers at a price of $52.10 per unit. g.Completed and transferred the standard cost associated with the 12,600 units sold from finished goods to cost of goods sold. h.Paid $73,000 of selling and administrative expenses. i.Closed all standard cost variances to cost of goods sold. Required: 1.Compute all direct materials,direct labor,and fixed overhead variances for the year. 2.Enter the beginning balances and record the above transactions in the worksheet that appears below.Because of the width of the worksheet,it is in two parts.In your text,these two parts would be joined side-by-side to make one very wide worksheet. 3.Determine the ending balance (e.g.,12/31 balance)in each account. 4.Prepare an income statement for the year.

Cleland Corporation manufactures one product.It does not maintain any beginning or ending Work in Process inventories.The company uses a standard cost system in which inventories are recorded at their standard costs and any variances are closed directly to Cost of Goods Sold.There is no variable manufacturing overhead.The standard cost card for the company's only product is as follows: The standard fixed manufacturing overhead rate was based on budgeted fixed manufacturing overhead of $56,250 and budgeted activity of 12,500 hours. During the year,the company completed the following transactions: a.Purchased 29,400 gallons of raw material at a price of $5.20 per gallon. b.Used 25,520 gallons of the raw material to produce 18,300 units of work in process. c.Assigned direct labor costs to work in process.The direct labor workers (who were paid in cash)worked 8,850 hours at an average cost of $19.60 per hour. d.Applied fixed overhead to the 18,300 units in work in process inventory using the predetermined overhead rate multiplied by the number of direct labor-hours allowed.Actual fixed overhead costs for the year were $41,650.Of this total,-$3,350 related to items such as insurance,utilities,and indirect labor salaries that were all paid in cash and $45,000 related to depreciation of manufacturing equipment. e.Transferred 18,300 units from work in process to finished goods. f.Sold for cash 20,600 units to customers at a price of $26.70 per unit. g.Completed and transferred the standard cost associated with the 20,600 units sold from finished goods to cost of goods sold. h.Paid $55,000 of selling and administrative expenses. i.Closed all standard cost variances to cost of goods sold. Required: 1.Compute all direct materials,direct labor,and fixed overhead variances for the year. 2.Record the above transactions in the worksheet that appears below.Because of the width of the worksheet,it is in two parts.In your text,these two parts would be joined side-by-side to make one very wide worksheet.The beginning balances have been provided for each of the accounts,including the Property,Plant,and Equipment (net)account which is abbreviated as PP&E (net). 3.Determine the ending balance (e.g.,12/31 balance)in each account.

Arellanes Corporation manufactures one product.It does not maintain any beginning or ending Work in Process inventories.The company uses a standard cost system in which inventories are recorded at their standard costs and any variances are closed directly to Cost of Goods Sold.There is no variable manufacturing overhead.The company's balance sheet at the beginning of the year was as follows: The standard cost card for the company's only product is as follows: The standard fixed manufacturing overhead rate was based on budgeted fixed manufacturing overhead of $198,000 and budgeted activity of 18,000 hours. During the year,the company completed the following transactions: a.Purchased 75,900 kilos of raw material at a price of $6.40 per kilo. b.Used 68,680 kilos of the raw material to produce 25,400 units of work in process. c.Assigned direct labor costs to work in process.The direct labor workers (who were paid in cash)worked 24,160 hours at an average cost of $19.80 per hour. d.Applied fixed overhead to the 25,400 units in work in process inventory using the predetermined overhead rate multiplied by the number of direct labor-hours allowed.Actual fixed overhead costs for the year were $187,400.Of this total,$95,400 related to items such as insurance,utilities,and indirect labor salaries that were all paid in cash and $92,000 related to depreciation of manufacturing equipment. e.Transferred 25,400 units from work in process to finished goods. f.Sold for cash 24,200 units to customers at a price of $52.80 per unit. g.Completed and transferred the standard cost associated with the 24,200 units sold from finished goods to cost of goods sold. h.Paid $121,000 of selling and administrative expenses. i.Closed all standard cost variances to cost of goods sold. Required: 1.Compute all direct materials,direct labor,and fixed overhead variances for the year. 2.Enter the beginning balances and record the above transactions in the worksheet that appears below.Because of the width of the worksheet,it is in two parts.In your text,these two parts would be joined side-by-side to make one very wide worksheet. 3.Determine the ending balance (e.g.,12/31 balance)in each account. 4.Prepare an income statement for the year.

Bialas Corporation uses a standard cost system in which inventories are recorded at their standard costs and any variances are closed directly to Cost of Goods Sold.The standards for direct materials for the company's only product specify 1.6 liters per unit at $7.00 per liter or $11.20 per unit.During the year,the company purchased 36,400 liters of raw material at a price of $7.40 per liter and used 32,060 liters of the raw material to produce 20,100 units of work in process. Assume that all transactions are recorded on a worksheet as shown in the text.On the left-hand side of the equals sign in the worksheet are columns for Cash,Raw Materials,Work in Process,Finished Goods,and PP&E (net).All of the variance columns are on the right-hand-side of the equals sign along with the column for Retained Earnings. When the purchase of raw materials is recorded,which of the following entries will be made?

Milanese Corporation manufactures one product.It does not maintain any beginning or ending Work in Process inventories.The company uses a standard cost system in which inventories are recorded at their standard costs and any variances are closed directly to Cost of Goods Sold.There is no variable manufacturing overhead.The company's balance sheet at the beginning of the year was as follows: The standard cost card for the company's only product is as follows: The standard fixed manufacturing overhead rate was based on budgeted fixed manufacturing overhead of $186,000 and budgeted activity of 12,000 hours. During the year,the company completed the following transactions: a.Purchased 52,400 gallons of raw material at a price of $8.90 per gallon. b.Used 46,380 gallons of the raw material to produce 17,800 units of work in process. c.Assigned direct labor costs to work in process.The direct labor workers (who were paid in cash)worked 11,080 hours at an average cost of $18.90 per hour. d.Applied fixed overhead to the 17,800 units in work in process inventory using the predetermined overhead rate multiplied by the number of direct labor-hours allowed.Actual fixed overhead costs for the year were $197,100.Of this total,$122,100 related to items such as insurance,utilities,and indirect labor salaries that were all paid in cash and $75,000 related to depreciation of manufacturing equipment. e.Transferred 17,800 units from work in process to finished goods. f.Sold for cash 17,700 units to customers at a price of $52.30 per unit. g.Completed and transferred the standard cost associated with the 17,700 units sold from finished goods to cost of goods sold. h.Paid $53,000 of selling and administrative expenses. i.Closed all standard cost variances to cost of goods sold. Required: 1.Compute all direct materials,direct labor,and fixed overhead variances for the year. 2.Enter the beginning balances and record the above transactions in the worksheet that appears below.Because of the width of the worksheet,it is in two parts.In your text,these two parts would be joined side-by-side to make one very wide worksheet. 3.Determine the ending balance (e.g.,12/31 balance)in each account.

Robins Corporation manufactures one product. It does not maintain any beginning or ending Work in Process inventories. The company uses a standard cost system in which inventories are recorded at their standard costs and any variances are closed directly to Cost of Goods Sold. There is no variable manufacturing overhead. The standard cost card for the company's only product is as follows: The standard fixed manufacturing overhead rate was based on budgeted fixed manufacturing overhead of $360,000 and budgeted activity of 20,000 hours. During the year, the company completed the following transactions: a. Purchased 134,700 pounds of raw material at a price of $9.10 per pound. b. Used 122,080 pounds of the raw material to produce 32,100 units of work in process. c. Assigned direct labor costs to work in process. The direct labor workers (who were paid in cash) worked 26,680 hours at an average cost of $17.20 per hour. d. Applied fixed overhead to the 32,100 units in work in process inventory using the predetermined overhead rate multiplied by the number of direct labor-hours allowed. Actual fixed overhead costs for the year were $378,400. Of this total, $297,400 related to items such as insurance, utilities, and indirect labor salaries that were all paid in cash and $81,000 related to depreciation of manufacturing equipment. e. Completed and transferred 32,100 units from work in process to finished goods. Assume that all transactions are recorded on the below worksheet, which is similar to the worksheet shown in your text except that it has been divided into two parts so that it fits on one page. The beginning balances in each of the accounts have been given. PP&E (net) stands for Property, Plant, and Equipment net of depreciation. -When recording the direct labor costs in transaction (c)above,the Cash account will increase (decrease)by:

Freiling Corporation manufactures one product. It does not maintain any beginning or ending Work in Process inventories. The company uses a standard cost system in which inventories are recorded at their standard costs. There is no variable manufacturing overhead. The standard cost card for the company's only product is as follows: During the year, the company assigned direct labor costs to work in process. The direct labor workers (who were paid in cash) worked 14,890 hours at an average cost of $22.80 per hour. Assume that all transactions are recorded on the below worksheet, which is similar to the worksheet shown in your text except that it has been divided into two parts so that it fits on one page. The beginning balances in each of the accounts have been given. PP&E (net) stands for Property, Plant, and Equipment net of depreciation. -When the direct labor cost is recorded,which of the following entries will be made?

Mangrum Corporation manufactures one product. It does not maintain any beginning or ending Work in Process inventories. The company uses a standard cost system in which inventories are recorded at their standard costs. Information concerning the direct labor standards for the company's only product is as follows: During the year, the company assigned direct labor costs to work in process. The direct labor workers (who were paid in cash) worked 12,790 hours at an average cost of $19.50 per hour. The company calculated the following direct labor variances for the year: Assume that all transactions are recorded on the below worksheet, which is similar to the worksheet shown in your text except that it has been divided into two parts so that it fits on one page. The beginning balances in each of the accounts have been given. PP&E (net) stands for Property, Plant, and Equipment net of depreciation. -When recording the direct labor costs,the Cash account will increase (decrease)by:

Santiago Corporation manufactures one product.It does not maintain any beginning or ending Work in Process inventories.The company uses a standard cost system in which inventories are recorded at their standard costs and any variances are closed directly to Cost of Goods Sold.There is no variable manufacturing overhead.The standard cost card for the company's only product is as follows: The standard fixed manufacturing overhead rate was based on budgeted fixed manufacturing overhead of $192,000 and budgeted activity of 12,000 hours. During the year,the company completed the following transactions: a.Purchased 53,000 liters of raw material at a price of $6.80 per liter. b.Used 47,620 liters of the raw material to produce 13,200 units of work in process. c.Assigned direct labor costs to work in process.The direct labor workers (who were paid in cash)worked 8,220 hours at an average cost of $19.20 per hour. d.Applied fixed overhead to the 13,200 units in work in process inventory using the predetermined overhead rate multiplied by the number of direct labor-hours allowed.Actual fixed overhead costs for the year were $180,700.Of this total,$116,700 related to items such as insurance,utilities,and indirect labor salaries that were all paid in cash and $64,000 related to depreciation of manufacturing equipment. e.Transferred 13,200 units from work in process to finished goods. f.Sold for cash 12,800 units to customers at a price of $56.50 per unit. g.Completed and transferred the standard cost associated with the 12,800 units sold from finished goods to cost of goods sold. h.Paid $39,000 of selling and administrative expenses. i.Closed all standard cost variances to cost of goods sold. Required: 1.Compute all direct materials,direct labor,and fixed overhead variances for the year. 2.Record the above transactions in the worksheet that appears below.Because of the width of the worksheet,it is in two parts.In your text,these two parts would be joined side-by-side to make one very wide worksheet.The beginning balances have been provided for each of the accounts,including the Property,Plant,and Equipment (net)account which is abbreviated as PP&E (net). 3.Determine the ending balance (e.g.,12/31 balance)in each account.

Robnett Corporation manufactures one product. It does not maintain any beginning or ending Work in Process inventories. The company uses a standard cost system in which inventories are recorded at their standard costs. There is no variable manufacturing overhead. The standard cost card for the company's only product is as follows: During the year, the company completed the following transactions: a. Purchased 106,900 liters of raw material at a price of $6.80 per liter. b. Used 93,760 liters of the raw material to produce 24,700 units of work in process. Assume that all transactions are recorded on the below worksheet, which is similar to the worksheet shown in your text except that it has been divided into two parts so that it fits on one page. The beginning balances in each of the accounts have been given. PP&E (net) stands for Property, Plant, and Equipment net of depreciation. -When recording the raw materials purchases in transaction (a)above,the Raw Materials inventory account will increase (decrease)by:

Isaman Corporation uses a standard cost system in which inventories are recorded at their standard costs and any variances are closed directly to Cost of Goods Sold.The direct labor standards for the company's only product specify 0.60 hours per unit at $21.50 per hour.During the year,the company started and completed 11,500 units.Direct labor employees worked 7,500 hours at an average cost of $19.50 per hour. During the year,the company started and completed 11,500 units.Direct labor employees worked 7,500 hours at an average cost of $19.50 per hour. Assume that all transactions are recorded on a worksheet as shown in the text.On the left-hand side of the equals sign in the worksheet are columns for Cash,Raw Materials,Work in Process,Finished Goods,and PP&E (net).All of the variance columns are on the right-hand-side of the equals sign along with the column for Retained Earnings. When the direct labor cost is recorded,which of the following entries will be made?

Kita Corporation manufactures one product. It does not maintain any beginning or ending Work in Process inventories. The company uses a standard cost system in which inventories are recorded at their standard costs. There is no variable manufacturing overhead. The standard cost card for the company's only product is as follows: During the year, the company assigned direct labor costs to work in process. The direct labor workers (who were paid in cash) worked 24,820 hours at an average cost of $21.20 per hour. Assume that all transactions are recorded on the below worksheet, which is similar to the worksheet shown in your text except that it has been divided into two parts so that it fits on one page. The beginning balances in each of the accounts have been given. PP&E (net) stands for Property, Plant, and Equipment net of depreciation. -When the direct labor cost is recorded,which of the following entries will be made?

Ester Corporation manufactures one product. It does not maintain any beginning or ending Work in Process inventories. The company uses a standard cost system in which inventories are recorded at their standard costs. There is no variable manufacturing overhead. The standard cost card for the company's only product is as follows: The standard fixed manufacturing overhead rate was based on budgeted fixed manufacturing overhead of $168,000 and budgeted activity of 24,000 hours. During the year, the company applied fixed overhead to the 22,600 units in work in process inventory using the predetermined overhead rate multiplied by the number of direct labor-hours allowed. Actual fixed overhead costs for the year were $149,800. Of this total, $83,800 related to items such as insurance, utilities, and indirect labor salaries that were all paid in cash and $66,000 related to depreciation of manufacturing equipment. Assume that all transactions are recorded on the below worksheet, which is similar to the worksheet shown in your text except that it has been divided into two parts so that it fits on one page. The beginning balances in each of the accounts have been given. PP&E (net) stands for Property, Plant, and Equipment net of depreciation. -When the fixed manufacturing overhead cost is recorded,which of the following entries will be made?

Gersbach Corporation manufactures one product.It does not maintain any beginning or ending Work in Process inventories.The company uses a standard cost system in which inventories are recorded at their standard costs and any variances are closed directly to Cost of Goods Sold.The company has provided the following information: The company does not have any variable manufacturing overhead costs and it recorded the following variances during the year: The net operating income for the year is closest to:

Phann Corporation manufactures one product. It does not maintain any beginning or ending Work in Process inventories. The company uses a standard cost system in which inventories are recorded at their standard costs and any variances are closed directly to Cost of Goods Sold. There is no variable manufacturing overhead. The standard cost card for the company's only product is as follows: The standard fixed manufacturing overhead rate was based on budgeted fixed manufacturing overhead of $90,000 and budgeted activity of 7,500 hours. During the year, the company completed the following transactions: a. Purchased 59,000 kilos of raw material at a price of $9.20 per kilo. b. Used 51,340 kilos of the raw material to produce 18,300 units of work in process. c. Assigned direct labor costs to work in process. The direct labor workers (who were paid in cash) worked 8,850 hours at an average cost of $23.70 per hour. d. Applied fixed overhead to the 18,300 units in work in process inventory using the predetermined overhead rate multiplied by the number of direct labor-hours allowed. Actual fixed overhead costs for the year were $79,400. Of this total, $22,400 related to items such as insurance, utilities, and indirect labor salaries that were all paid in cash and $57,000 related to depreciation of manufacturing equipment. e. Completed and transferred 18,300 units from work in process to finished goods. Assume that all transactions are recorded on the below worksheet, which is similar to the worksheet shown in your text except that it has been divided into two parts so that it fits on one page. The beginning balances in each of the accounts have been given. PP&E (net) stands for Property, Plant, and Equipment net of depreciation. -When recording the raw materials purchases in transaction (a)above,the Cash account will increase (decrease)by:

Alberts Corporation manufactures one product. It does not maintain any beginning or ending Work in Process inventories. The company uses a standard cost system in which inventories are recorded at their standard costs. The standard cost card for the company's only product is as follows: The standard fixed manufacturing overhead rate was based on budgeted fixed manufacturing overhead of $240,000 and budgeted activity of 20,000 hours. During the year, the company applied fixed overhead to the 15,200 units in work in process inventory using the predetermined overhead rate multiplied by the number of direct labor-hours allowed. Actual fixed overhead costs for the year were $223,700. Of this total, $147,700 related to items such as insurance, utilities, and indirect labor salaries that were all paid in cash and $76,000 related to depreciation of manufacturing equipment. Assume that all transactions are recorded on the below worksheet, which is similar to the worksheet shown in your text except that it has been divided into two parts so that it fits on one page. The beginning balances in each of the accounts have been given. PP&E (net) stands for Property, Plant, and Equipment net of depreciation. -When the fixed manufacturing overhead cost is recorded,which of the following entries will be made?

Robnett Corporation manufactures one product. It does not maintain any beginning or ending Work in Process inventories. The company uses a standard cost system in which inventories are recorded at their standard costs. There is no variable manufacturing overhead. The standard cost card for the company's only product is as follows: During the year, the company completed the following transactions: a. Purchased 106,900 liters of raw material at a price of $6.80 per liter. b. Used 93,760 liters of the raw material to produce 24,700 units of work in process. Assume that all transactions are recorded on the below worksheet, which is similar to the worksheet shown in your text except that it has been divided into two parts so that it fits on one page. The beginning balances in each of the accounts have been given. PP&E (net) stands for Property, Plant, and Equipment net of depreciation. -When the purchase of raw materials is recorded in transaction (a)above,which of the following entries will be made?

Dalgleish Corporation manufactures one product.It does not maintain any beginning or ending Work in Process inventories.The company uses a standard cost system in which inventories are recorded at their standard costs and any variances are closed directly to Cost of Goods Sold.There is no variable manufacturing overhead.The standard cost card for the company's only product is as follows: The standard fixed manufacturing overhead rate was based on budgeted fixed manufacturing overhead of $358,750 and budgeted activity of 17,500 hours.During the year,32,900 units were started and completed.Actual fixed overhead costs for the year were $347,350. Assume that all transactions are recorded on a worksheet as shown in the text.On the left-hand side of the equals sign in the worksheet are columns for Cash,Raw Materials,Work in Process,Finished Goods,and PP&E (net).All of the variance columns are on the right-hand-side of the equals sign along with the column for Retained Earnings. When the fixed manufacturing overhead cost is recorded,which of the following entries will be made?