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A manufacturing company has the following budgeted and actual figures for a particular month: Budgeted production: 5,000 units Actual production: 4,800 units Budgeted cost per
A manufacturing company has the following budgeted and actual figures for a particular month:
- Budgeted production: 5,000 units
- Actual production: 4,800 units
- Budgeted cost per unit: $10
- Actual cost per unit: $11
Requirements:
- Calculate the total budgeted cost.
- Calculate the total actual cost.
- Compute the cost variance.
- Identify if the variance is favorable or unfavorable.
- Provide two possible reasons for the variance.
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