10:47 1 - LTE (45) Better By the Numbers began operations on January 1, 2018. The company produces eight ounce bottles of hand and body lotion called Radiant One. The lotion is sold wholesale in 12- bottle cases for $95 per case. There is a selling commission of $20 per case. January 2018 direct materials, direct labor and factory overhead costs are as follows: DIRECT MATERIALS Cost Units per Cost per Behavior Case unit variable 100 oz. $ 0.06 variable 30 OZ. $0.34 variable 12 bottles $ 0.60 Nutrient base Essential oils Bottle (8-oz.) Direct Materials Cost per Case $6.00 12.00 7.20 $25.20 Department Cost Behavior variable variable DIRECT LABOR Time per Labor Rate Case per Hour 15 min. $ 20.00 6 min. $ 15.50 21 min Mixing Filling Direct Labor Cost per Case $ 5.00 1.55 $ 6.55 FACTORY OVERHEAD Cost Behavior Total Cost Utilities mixed $ 600 Facility lease fixed 14,000 Equipment depreciation fixed 4,300 Supplies fixed $ 19,412 512 Part C: AUGUST VARIANCE ANALYSIS After August was completed, variance analysis needs to be performed January operating data provided the standard prices, rates, times, and quantities per case. There were 1,500 actual cases produced during August Actual August data: Nutrient base Essential oils Bottle (8-02.) Actual Direct Materials Price per Unit $0.056 per oz. $0.45 per or $0.55 per bottle Actual Direct Labor Actual Direct Materials Quantity per Case 102 os. 31 os 12.5 bottles Actual Direct Labor Time per Case Rate Mixing Filling $20.25 $ 15.00 14.6 min. 5.5 min. The standard quantity of materials used per case was an ideal standard. Actual Variable Overhead was $305 Standard (Budgeted) Volume was 1,600 cases Requirements: NormalT No Spa.. Heading 1 Heading Paragraph Styles THE PER Mixing Filling $ 20.25 $15.00 14.6 min. 5.5 min. The standard quantity of materials used per case was an ideal standard. Actual Variable Overhead was $305 Standard (Budgeted) Volume was 1,600 cases Requirements: 10. Determine and interpret (favorable/unfavorable) the direct materials price and quantity variances for each of the three materials 11. Determine and interpret the direct labor rate and time variances for the two departments, rounding hours to the nearest hour 12. Determine and interpret the factory overhead controllable variance 13. Determine and interpret the factory overhead volume variance