Problem II 20 Points Cousin Cousin Company applies both variable and fixed overhead based on machine hours. The relevant range of production for this activity is 0 to 10,000 units per month. For October, 2015, the following monthly information is obtained:Budgeted and Standard Amounts:Machine hours per unit of output……………………… 3Variable overhead per machine hour………………. $ ?Fixed overhead per machine hour…………………… $2.10Total overhead per machine hour…………………… $2.90 (both variable and fixed)Total budgeted fixed overhead………………………. $ ?Total budgeted variable overhead…………………… $4,800Budgeted machine hours………………………………… ?Budgeted output in units………………………………… 2,000Actual Amounts:Units produced……………………………….. 2,200Machine hours………………………………… 6,800Variable overhead…………………………… $4,900Fixed overhead………………………………. $12,000Required:1. Calculate the amounts for the ? above.A. Variable Overhead per Machine Hour is:B. Total Budgeted Fixed Overhead is:C. Total Budgeted Machine Hours are:2. If production were budgeted at 1,800 units, what would be the amount of the total budgeted fixed and total budgeted variable overhead costs in the flexible budget for October?Fixed -Variable -continued3. Compute the fixed overhead and variable overhead variances. Compute a total of four variances.

4. Prepare one journal entry to record the fixed overhead variances (standard costing system). Omit the journal entry explanation.Problem III 25 PointsCousin Pyramid Ponzi Company uses a standard cost system for its single product. The following data are available:Actual results for the current period:Purchase of direct materials (20,000 pounds)……….. $19,500 (on account)Direct materials used…………………………………………. 12,000 poundsDirect Labor (10,200 hours)…………………………….. $102,000 (accrued liability)Units Produced ………………………………………………… 12,600Standard cost, material quantity, and direct labor hours and rate per unit of output:Direct Materials: 1 pound at $1 per poundDirect Labor: .8 hour (48 minutes) at $9.50 per hourRequired:1. Compute the direct labor price and efficiency variances.2. Prepare one journal entry to record the actual direct labor cost and the amount applied to production, including the direct labor price and efficiency variances (standard costing system).The credit is to Wages Payable, a current liability account. Omit the journal entry explanation.continued3. Compute the direct materials price and efficiency variances. The material price variance is calculated at the time of purchase.4. Prepare the journal entry under a standard costing system (including variances) to:(a) record the purchase of direct materials (omit explanation)(b) record the usage of direct materials in production (omit explanation)Problem II 20 PointsCousin Cousin Company applies both variable and fixed overhead based on machine hours. The relevant range of production for this activity is 0 to 10,000 units per month. For October, 2015, the following monthly information is obtained:Budgeted and Standard Amounts:Machine hours per unit of output……………………… 3Variable overhead per machine hour………………. $ ?Fixed overhead per machine hour…………………… $2.10Total overhead per machine hour…………………… $2.90 (both variable and fixed)Total budgeted fixed overhead………………………. $ ?Total budgeted variable overhead…………………… $4,800Budgeted machine hours………………………………… ?Budgeted output in units………………………………… 2,000Actual Amounts:Units produced……………………………….. 2,200Machine hours………………………………… 6,800Variable overhead…………………………… $4,900Fixed overhead………………………………. $12,000Required:1. Calculate the amounts for the ? above.A. Variable Overhead per Machine Hour is:B. Total Budgeted Fixed Overhead is:C. Total Budgeted Machine Hours are:2. If production were budgeted at 1,800 units, what would be the amount of the total budgeted fixed and total budgeted variable overhead costs in the flexible budget for October?Fixed -Variable -continued3. Compute the fixed overhead and variable overhead variances. Compute a total of four variances.4. Prepare one journal entry to record the fixed overhead variances (standard costing system). Omit the journal entry explanation.Problem III 25 PointsCousin Pyramid Ponzi Company uses a standard cost system for its single product. The following data are available:Actual results for the current period:Purchase of direct materials (20,000 pounds)……….. $19,500 (on account)Direct materials used…………………………………………. 12,000 poundsDirect Labor (10,200 hours)…………………………….. $102,000 (accrued liability)Units Produced ………………………………………………… 12,600Standard cost, material quantity, and direct labor hours and rate per unit of output:Direct Materials: 1 pound at $1 per poundDirect Labor: .8 hour (48 minutes) at $9.50 per hourRequired:1. Compute the direct labor price and efficiency variances.2. Prepare one journal entry to record the actual direct labor cost and the amount applied to production, including the direct labor price and efficiency variances (standard costing system).The credit is to Wages Payable, a current liability account. Omit the journal entry explanation.continued3. Compute the direct materials price and efficiency variances. The material price variance is calculated at the time of purchase.4. Prepare the journal entry under a standard costing system (including variances) to:(a) record the purchase of direct materials (omit explanation)(b) record the usage of direct materials in production (omit explanation)