The Energy Products Company produces a gasoline additive, Gas Gain that increases engine efficiency and improves gasoline

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The Energy Products Company produces a gasoline additive, Gas Gain that increases engine efficiency and improves gasoline mileage. The actual and budgeted quantities (in litres) of materials required to produce Gas Gain and the budgeted prices of materials in August 2015 are as follows:

The Energy Products Company produces a gasoline additive, Gas Gain

Required
1. Calculate the total direct materials efficiency variance for August 2015.
2. Calculate the total direct materials mix and yield variances for August 2015.
3. What conclusions would you draw from the variance analysis?

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Cost Accounting A Managerial Emphasis

ISBN: 978-0133138443

7th Canadian Edition

Authors: Srikant M. Datar, Madhav V. Rajan, Charles T. Horngren, Louis Beaubien, Chris Graham

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