Direct materials efficiency, mix, and yield variances. Flavr-Wave Company makes candy. Their most popular product is the toe pop, a large lollipop shaped like a toe. The direct mate- rials used in the toe pop are sugar, flavouring, and colouring. For each batch of 100 pops, the budgeted quantities and budgeted prices of direct materials are as follows:

REQUIRED 1. What is the budgeted cost of direct materials for the 2,300 toe pops?
2. Calculate the total direct materials efficiency variance.
3. Why is the total direct materials price variance zero?
4. Calculate the total direct materials mix and yield variances. What are these variances telling you about the 2,300 toe pops produced this period? Are the variances large enough to investigate?LO1

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Quantity for One Batch Price of Input Sugar 7 litres $1 per litre Flavouring 2 litres $3 per litre Colouring 1 litres $2 per litre Changing the standard mix of direct material quantities slightly does not significantly affect the overall end product, particularly for the flavouring and colouring. In the current period, Flavr-Wave made 2,300 toe pops in 23 batches with the following actual quantity, cost, and mix of inputs: Actual Mix Actual Quantity Actual Cost (rounded) Sugar 165 litres $165 70% Flavouring 45 litres 135 19% Colouring 25 litres 50 11% Total actual 235 litres $350 100%