Purchase Solution

# Wells Inc., a manufacturer of construction equipment

Not what you're looking for?

Problem 6-4A p. 250
Variance report

Wells Inc., a manufacturer of construction equipment, prepared the following factory overhead cost budget for the Welding Department for May 2003. The company expected to operate the department at 100% of normal capacity of 3,000 hours.

Variable costs:
Indirect factory wages \$22,800
Power and light 3,750
Indirect materials 10,200
Total variable cost \$36,750

Fixed costs:
Supervisory salaries \$67,500
Depreciation of plant and equipment 26,400
Insurance and property taxes 5,100
Total fixed cost 99,000

Total factory and overhead cost \$135,750

During May, the department operated at 3,100 hours, and the factory overhead costs incurred were: indirect factory wages, \$23,450: power and light, \$3,980: indirect materials, \$10,600; supervisory salaries, \$67,500; depreciation of plant and equipment, \$26,400; and insurance and property taxes, \$5,100.

Instructions:

Prepare a factory overhead cost variance report for May. To be useful for cost control, the budgeted amounts should be based on 3,100 hours.

##### Accounting: Statement of Cash flows

This quiz tests your knowledge of the components of the statements of cash flows and the methods used to determine cash flows.

This quiz prepares a person to do well when it comes to studying organizational leadership in their studies.

##### Managing the Older Worker

This quiz will let you know some of the basics of dealing with older workers. This is increasingly important for managers and human resource workers as many countries are facing an increase in older people in the workforce

##### Understanding the Accounting Equation

These 10 questions help a new student of accounting to understand the basic premise of accounting and how it is applied to the business world.

##### SWOT

This quiz will test your understanding of the SWOT analysis, including terms, concepts, uses, advantages, and process.