Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

7-33 Flexible budget, direct materials, and direct manufacturing labour variances. Emerald Statuary manufactures bust statues of famous historical figures. All statues are the same size.

7-33 Flexible budget, direct materials, and direct manufacturing labour variances. Emerald Statuary manufactures bust statues of famous historical figures. All statues are the same size. Each unit requires the same amount of resources. The following information is from the static budget for 2021:

Expected production and sales Expected selling price per unit Total fixed costs 7,000 units $ 680 $1,400,000

Standard quantities, standard prices, and standard unit costs follow for direct materials and direct manufacturing labour: Standard Quantity Standard Price Standard Unit Cost Standard quantity Standard price Standard unit cost

Direct materials Direct manufacturing labour 10 kilograms 3.7 hours $ 8 per kilogram $50 per hour $ 80 $185

During 2021, actual number of units produced and sold was 4,800, at an average selling price of $720. Actual cost of direct materials used was $392,700, based on 66,000 kilograms purchased at $5.95 per kilogram. Direct manufacturing labour-hours actually used were 18,300, at the rate of $48 per hour. As a result, actual direct manufacturing labour costs were $878,400. Actual fixed costs were $1,170,000. There were no beginning or ending inventories. Required 1. Calculate the sales-volume variance and flexible-budget variance for operating income. 2. Compute price and efficiency variances for direct materials and direct manufacturing labour.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Database Security And Auditing Protecting Data Integrity And Accessibility

Authors: Hassan A. Afyouni

1st Edition

0619215593, 9780619215590

More Books

Students also viewed these Accounting questions

Question

6.3 Explain the importance of application forms.

Answered: 1 week ago