Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

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

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. $4.9
Sugar 10 lb. 14 lb. 0.6
Standard labor time 0.3 hr. 0.4 hr.

Dark Chocolate Light Chocolate
Planned production 4,700 cases 10,800 cases
Standard labor rate $16 per hr. $16 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) 4,500 11,200
Actual Price per Pound Actual Pounds Purchased and Used
Cocoa $5 155,600
Sugar 0.55 196,800
Actual Labor Rate Actual Labor Hours Used
Dark chocolate $15.6 per hr. 1,230
Light chocolate 16.4 per hr. 4,590

Required:

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:

  1. Direct materials price variance, direct materials quantity variance, and total variance.
  2. Direct labor rate variance, direct labor time variance, and total variance.

Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. If there is no variance, enter a zero.

a. Direct materials price variance 5720 Unfavorable
Direct materials quantity variance Unfavorable
Total direct materials cost variance Unfavorable
b. Direct labor rate variance Unfavorable
Direct labor time variance Favorable
Total direct labor cost variance Unfavorable

Can anyone help with this? I included the favorable/unfavorable answers as marked correct by my program but I can't seem to get any of the answers right except the first one. Thank you.

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

Fundamentals Of Entrepreneurial Finance

Authors: Marco Da Rin, Thomas Hellmann

8th Edition

0199744750, 9780199744756

More Books

Students also viewed these Accounting questions