Wade Company estimates that it will produce 6,000 units of product IOA during th

Question

Wade Company estimates that it will produce 6,000 units of product IOA during the current month. Budgeted variable manufacturing costs per unit are direct materials $7, direct labor $11, and overhead $17. Monthly budgeted fixed manufacturing overhead costs are $8,200 for depreciation and $3,600 for supervision.

In the current month, Wade actually produced 6,500 units and incurred the following costs: direct materials $39,500, direct labor $64,100, variable overhead $110,800, depreciation $8,200, and supervision $3,820.

Prepare a static budget report. Hint: The Budget column is based on estimated production while the Actual column is the actual cost incurred during the period. (List variable costs before fixed costs.)

Wade Company
Static Budget Report

Difference

Budget

Actual

Favorable
Unfavorable
Neither Favorable
nor Unfavorable

Were costs controlled?

Wade Company
Static Budget Report

Difference

Budget

Actual

Favorable
Unfavorable
Neither Favorable
nor Unfavorable

DepreciationDirect LaborDirect MaterialsFixed CostsOverheadSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUnits ProducedVariable Costs

DepreciationDirect LaborDirect MaterialsFixed CostsOverheadSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUnits ProducedVariable Costs

DepreciationDirect LaborDirect MaterialsFixed CostsOverheadSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUnits ProducedVariable Costs

$

$

$

FavorableUnfavorableNeither Favorable nor Unfavorable

DepreciationDirect LaborDirect MaterialsFixed CostsOverheadSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUnits ProducedVariable Costs

FavorableUnfavorableNeither Favorable nor Unfavorable

DepreciationDirect LaborDirect MaterialsFixed CostsOverheadSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUnits ProducedVariable Costs

FavorableUnfavorableNeither Favorable nor Unfavorable

DepreciationDirect LaborDirect MaterialsFixed CostsOverheadSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUnits ProducedVariable Costs

FavorableUnfavorableNeither Favorable nor Unfavorable

DepreciationDirect LaborDirect MaterialsFixed CostsOverheadSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUnits ProducedVariable Costs

DepreciationDirect LaborDirect MaterialsFixed CostsOverheadSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUnits ProducedVariable Costs

FavorableUnfavorableNeither Favorable nor Unfavorable

DepreciationDirect LaborDirect MaterialsFixed CostsOverheadSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUnits ProducedVariable Costs

FavorableUnfavorableNeither Favorable nor Unfavorable

DepreciationDirect LaborDirect MaterialsFixed CostsOverheadSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUnits ProducedVariable Costs

FavorableUnfavorableNeither Favorable nor Unfavorable

DepreciationDirect LaborDirect MaterialsFixed CostsOverheadSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUnits ProducedVariable Costs

$

$

$

FavorableUnfavorableNeither Favorable nor Unfavorable

Explanation / Answer

Answer

Budget

Actual

Difference

Units produced

6000

6500

500

Favourable

Variable Costs:

Direct materials

$                 42,000.00 [6000 x 7]

$                 39,500.00

$        2,500.00

Favourable

Direct labor

$                 66,000.00 [6000 x 11]

$                 64,100.00

$        1,900.00

Favourable

Overhead

$              1,02,000.00 [6000 x 17]

$             1,10,800.00

$        8,800.00

Unfavourable

Total variable cost

$              2,10,000.00

$             2,14,400.00

$        4,400.00

Unfavourable

Fixed Costs:

Depreciation

$                    8,200.00

$                   8,200.00

$                     -  

Neither F nor U

Supervision

$                    3,600.00

$                   3,820.00

$           220.00

Unfavourable

Total Fixed Costs

$                 11,800.00

$                 12,020.00

$           220.00

Unfavourable

Total Cost

$              2,21,800.00

$             2,26,420.00

$        4,620.00

Unfavourable

Budget

Actual

Difference

Units produced

6000

6500

500

Favourable

Variable Costs:

Direct materials

$                 42,000.00 [6000 x 7]

$                 39,500.00

$        2,500.00

Favourable

Direct labor

$                 66,000.00 [6000 x 11]

$                 64,100.00

$        1,900.00

Favourable

Overhead

$              1,02,000.00 [6000 x 17]

$             1,10,800.00

$        8,800.00

Unfavourable

Total variable cost

$              2,10,000.00

$             2,14,400.00

$        4,400.00

Unfavourable

Fixed Costs:

Depreciation

$                    8,200.00

$                   8,200.00

$                     -  

Neither F nor U

Supervision

$                    3,600.00

$                   3,820.00

$           220.00

Unfavourable

Total Fixed Costs

$                 11,800.00

$                 12,020.00

$           220.00

Unfavourable

Total Cost

$              2,21,800.00

$             2,26,420.00

$        4,620.00

Unfavourable

Related Questions

Navigate

• Browse (All)
• Browse W
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.