Caltex Products plc manufactures electric mini-lawnmowers. Its sales and costs budget for November 20X2 is as follows:

Sales: 3 000 units 72/unit

Costs: Direct materials (metal): 3 000 units (1kg per unit 14/kg)

Direct materials (plastic): 3 000 units (0.5kg per unit 7/kg)

Direct labour: 3 000 units (0.75 hours per unit 8/hr)

Production overhead: 86 500

Other overheads: 31 000

The company does not absorb production overheads using an overhead absorption rate.

It may be assumed that all of its overheads are fixed in nature. The companys actual results for the same month (November) are as follows: Sales: 2 950 units 73/unit

Costs: Direct materials (metal): 2 950 units (0.9kg per unit 13.80/kg)

Direct materials (plastic): 2 950 units (0.5kg per unit 7.20/unit)

Direct labour: 2 950 units (0.7 hrs per unit 8.20/hr)

Production overhead: 84 250

Other overheads: 32 250 Net profit: 34 658

Required:

a.

i) Produce a budget statement for Caltex for November

ii) Produce a profit statement for Caltex for November

b. Produce a flexed budget statement for Caltex for November

c. Calculate:

i) Sales price variance

ii) Sales profit volume variance

iii) Materials price variance (both materials)

iv) Labour rate variance

v) Labour efficiency variance

vi) Overhead variances (both)

d. Comment on your calculations produced in c above.