Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Case21.1CamparIndustries,Inc. Campar Industries, Inc., was a multidivisional firm whose several divisions competed in different countries. This case deals with variance analysis problems in several of

image text in transcribed
  • Case21.1CamparIndustries,Inc.

Campar Industries, Inc., was a multidivisional firm whose several divisions competed in different countries. This case deals with variance analysis problems in several of the divisions.

This case is about variance analysis. The purpose of this case is to allow you to break down several different types of variance that might occur in a business, including:

  • A margin variance caused by differences in price and volume
  • A combination of volume, product mix, and margin variance.
  • A materials mix variance
  • A breakdown of variance effects on an income statement

Please note that simply reporting the numbers is not an adequate solution; you have to explain how these different types of variance affect the whole firm. In addition,

  • You need to compare how the different divisions performed.
  • Youneedtoclearlystatehowthefirmperformedasawhole

Reference answer:

(Anthony 645)

Anthony.Accounting: Texts and Cases, 13th Edition. McGraw-Hill Learning Solutions, 05/2010. VitalBook file.

The citation provided is a guideline. Please check each citation for accuracy before use.

http://docslide.us/documents/ch21547cd4fcb4af9f4b688b45b3.html

image text in transcribed http://docslide.us/documents/ch21547cd4fcb4af9f4b68 8b45b3.html Campar Industries, Inc.* Campar Industries, Inc., was a multidivisional firm whose several divisions competed in different countries. This case deals with variance analysis problems in several of the divisions. ALPHA DIVISION In its annual profit budget, Alpha Division budgeted product A's sales volume at 24,000 units. Product A's budgeted price was $72 per unit; its standard cost was $43 per unit. Actual sales of product A turned out to be $1,658,250 for a volume of 22,000 units. Question Determine Alpha Division's gross margin variances. (Anthony 645) Anthony. Accounting: Texts and Cases, 13th Edition. McGraw-Hill Learning Solutions, 05/2010. VitalBook file. BETA DIVISION Beta Division makes three products. Last month's budgeted and actual sales and margins for these products were as follows: Anthony 645) Anthony. Accounting: Texts and Cases, 13th Edition. McGraw-Hill Learning Solutions, 05/2010. VitalBook file. Question Determine the gross margin mix, selling price, and sales volume variances. Calculate the net gross margin variance directly; then, as a check, see if it equals the sum of the three variance components you calculated individually. GAMMA DIVISION Gamma Division makes a product for which the standard raw materials cost per 100 pounds of finished product is shown below: Anthony 645) Anthony. Accounting: Texts and Cases, 13th Edition. McGraw-Hill Learning Solutions, 05/2010. VitalBook file. Because materials were not supposed to be spoiled during production, these standards included no waste allowance. During June, actual raw materials usage and costs were: Question Calculate the raw materials variances for June, referring back to Chapter 20 if necessary. Note: This problem contains a raw materials mix variance, analogous to the gross margin mix variance described in this chapter. DELTA DIVISION Delta Division makes two products, A and B. Both products use the same raw materials and are produced in the same factory by the same workforce. In preparing its annual statement of budgeted gross margin, Delta's management used the following assumptions: Anthony 645) Anthony. Accounting: Texts and Cases, 13th Edition. McGraw-Hill Learning Solutions, 05/2010. VitalBook file. The year's actual results were as follows: 1. 1,750 units of A were sold for a total of $533,750. 2. 3,250 units of B were sold for a total of $601,250. 3. Production totaled 1,800 units of A and 3,300 units of B. 4. 180,000 pounds of raw materials were purchased and used; their total cost was $330,480. 5. 9,450 hours of direct labor were worked at a total cost of $233,880. 6. Actual overhead costs were $320,000. Questions 1. Do as detailed an analysis of variances as the data given permit. 2. Prepare a summary statement for presentation to Delta's top management showing the year's budgeted and actual gross margin and an explanation of the difference between them

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

Payroll Accounting 2018

Authors: Bernard J. Bieg, Judith Toland

28th edition

1337291056, 978-1337291057, 1337291137, 9781337291132, 9781337516686 , 978-1337291040

More Books

Students also viewed these Accounting questions

Question

8. What are the costs of collecting the information?

Answered: 1 week ago

Question

1. Build trust and share information with others.

Answered: 1 week ago