Comprehensive Problem 6 (Algo)
[The following information applies to the questions displayed below.]
Utease Corporation has several production plants nationwide. A newly opened plant in Dubuque produces and sells one product. The plant is treated, for responsibility accounting purposes, as a profit center. The unit
standard costs for a production unit, with overhead applied based on direct labor hours, are as follows.
Manufacturing costs (per unit based on expected activity of 28,000 units or 56,000 direct labor hours):
Direct materials (3.0 pounds at $18)
Direct labor (2.0 hours at $80)
Variable overhead (2.0 hours at $15)
Fixed overhead (2.0 hours at $25)
Standard cost per unit
Budgeted selling and administrative costs:
Variable
Fixed
Units produced
Units sold
Unit selling price
Direct labor hours worked
Direct labor costs
Direct materials purchased
Direct materials costs
Direct materials used
Actual fixed overhead
Actual variable overhead
Actual selling and administrative costs
References
$
Expected sales activity: 24,000 units at $500 per unit
Desired ending inventories: 16% of sales
Assume this is the first year of operations for the Dubuque plant. During the year, the company had the following activity.
$
$
LA LA LA
$
54.00
160.00
30.00
50.00
294.00
8 per unit
$1,200,000
27,000
25,500
495
53,500
$ 4,333,500
85,000 pounds
$1,530,000
85,000 pounds
$ 900,000
740,000
$1,892,000
$
In addition, all over- or underapplied overhead and all product cost variances are adjusted to cost of goods sold.