eBook Question Content Area Flexible Budgeting and Variance Analysis I Love My Chocolate Company makes dark chocolate and light chocolate. Both products require cocoa and sugar. The following planning information has been made available: Standard Amount per Case Dark Chocolate Light Chocolate Standard Price per Pound Cocoa 12 lb. 9 lb. $5 Sugar 10 lb. 14 lb. 0.6 Standard labor time 0.3 hr. 0.4 hr. Dark Chocolate Light Chocolate Planned production 5,100 cases 13,600 cases Standard labor rate $13 per hr. $13 per hr. I Love My Chocolate does not expect there to be any beginning or ending inventories of cocoa or sugar. At the end of the budget year, I Love My Chocolate Company had the following actual results: Dark Chocolate Light Chocolate Actual production (cases) 4,800 14,100 Actual Price per Pound Actual Pounds Purchased and Used Cocoa $5.1 185,400 Sugar 0.55 239,300 Actual Labor Rate Actual Labor Hours Used Dark chocolate $12.5 per hr. 1,310 Light chocolate 13.5 per hr. 5,780

Flexible Budgeting and Variance Analysis I Love My Chocolate Company makes dark chocolate and light chocolate. Both products require cocoa and sugar. The following planning information has been made available: Prepare the following variance analyses for both chocolates and total, based on the actual results and production levels at the end of the budget year: a. Direct materials price variance, direct materials quantity variance, and total variance. b. Direct labor rate variance, direct labor time variance, and total variance. Enter a favorable varlance as a negative number using a minus sign and an unfavorable varlance as a positive number. If there is no variance, enter a zero. 2. The variance analyses should be based on the amounts at volumes. The budget must flex with the volume changes. If the volume production. In this way, spending from volume changes can be separated from efficiency and price variances. Feedback Check My Wark Unfavorable variances can be thought of as increasing costs (a cebit). Favorable variances can be thought of as decreasing costs (a credit). Review how actual production is analyzed by using standard amounts