Industries reports gross profit of $60.000 at standard and the following varianc
ID: 2597513 • Letter: I
Question
Industries reports gross profit of $60.000 at standard and the following variances Materials price Materials quantity Labor price Labor quantity s 100 F 500 F 250 1,000 F 250 F Rezo would report actual gross profit of a. $61,100 b. $60,000. C. $61,600 d. $61,000. 23). Raba Inc.'s budgeted overhead at normal capacity is 32,000 direct labor hours: standard costs are $6.50 per hour variable and $4.50 per hour foed. Overhead of $360,000 was incurred in May. During that time 31,500 actual hours were worked, 34,000 standard hours were allowed The overhead controllable variance is a. $5,000 unfavorable. b. $5,000 favorable c. $10,000 favorable. d. $10,000 unfavorable. 24) Adenton Company reported net sales of $600,000, $740,000, and $810,000 in the years 2016, 2017, and 2018, respectively. If 2016 is the base year, what is the trend percentage for 2018? a, 5096 b. 126% c. 135% d.109% 25) The accounts receivable turnover and inventory turnover are used to analyze a. long-term solvency b. profitability c. liquidity d. leverage. $460,000 at the end of the year. Net credit sales during the year amounted to $8,200,000. The accounts receivable turnover was 26) Rent-A-Duck had beginning of year Accounts Receivable balance of $540,000 a balance of a. 15.5 times. b. 16.4 times. c. 17.8 times.Explanation / Answer
22) Calculation of Actual Gross Profit (Amount in $)
Therefore, the correct option is c) $61,600.
23) Overhead Controllable Variance = Budgeted Overhead-Actual Overhead
Budgeted Overhead = (34,000 hours*$6.50 per hour)+(32,000 hours*$4.50 per hr)
= $221,000+$144,000 = $365,000
Actual Overhead = $360,000
Overhead controllable variance = $365,000-$360,000 = $5,000 Favourable
Therefore, the correct option is b) $5,000 Favourable
24) The correct option is c)135% which is calculated as follows:-
Trend percentage of 2018 = (2018 sales/2016 sales)*100 = ($810,000/$600,000)*100 = 135%
25) The correct option is b) Profitability. Average receivables turnover and inventory turnover are used to analyze profitability.
26) Accounts receivable turnover = Net credit sales/Average Account receivables
Net credit sales = $8,200,000
Average Accounts receivable = ($540,000+$460,000)/2 = $500,000
Accounts receivable turnover = $8,200,000/$500,000 = 16.4 times
Therefore the correct option is b) 16.4 times
Gross Profit at standard 60,000 Add: Favourable variances Materials Price 100 Materials Quantity 500 Labor Quantity 1,000 Overhead 250 Less: Unfavourable variances Labor Price (250) Actual Gross profit 61,600