Palmer Productions Uses a Standard Cost System Prepare a Multi-Step,standard Cost Income Statement

question 208

Essay

Palmer Productions uses a standard cost system.On December 31,the account balances include the following:
Sales Revenues: $750,000
Cost of Goods Sold (standard costing): $400,500
Selling & Administrative expenses: $150,000
Variances:
$$\begin{array} { | l | r | c | } \hline \text { Sales revenue variance } & \$ 6,000 & \mathrm {~F} \\\hline \text { Direct materials cost variance } & 400 & \mathrm { U } \\\hline \text { Direct materials efficiency variance } & 375 & \mathrm {~F} \\\hline \text { Direct labor cost variance } & 675 & \mathrm { U } \\\hline \text { Direct labor efficiency variance } & 150 & \mathrm {~F} \\\hline \text { Variable overhead cost variance } & 250 & \mathrm { U } \\\hline \text { Variable overhead efficiency variance } & 800 & \mathrm {~F} \\\hline \text { Fixed overhead cost variance } & 420 & \mathrm { U } \\\hline \text { Fixed overhead volume variance } & 100 & \mathrm {~F} \\\hline\end{array}$$ Prepare a multi-step,standard cost income statement.

---

Definitions:

Satisfactory Alternative

An acceptable option or solution that meets basic requirements or needs, though it may not be the optimal choice.

Behavioural Decision Model

Decision-making with limited information and bounded rationality.

Rational

Based on or in accordance with reason or logic; a way of thinking or decision-making that is logical and based on facts and evidence.

Available Information

Refers to data or knowledge that can be accessed by individuals or systems at a given time.