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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 9 lbs. 6 lbs. $5.30
Sugar 7 lbs. 11 lbs. 0.60
Standard labor time 0.3 hr. 0.4 hr.
Dark Chocolate Light Chocolate
Planned production 4,700 cases 12,600 cases
Standard labor rate $13.00 per hr. $13.00 per hr.

I Love My Chocolate Company 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 13,100
Actual Price per Pound Actual Pounds Purchased and Used
Cocoa $5.40 119,700
Sugar 0.55 171,200
Actual Labor Rate Actual Labor Hours Used
Dark chocolate $12.70 per hr. 1,230
Light chocolate 13.30 per hr. 5,370

Required:

1. Prepare the following variance analyses for both chocolates and the 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 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 $
Direct materials quantity variance $
Total direct materials cost variance $
b. Direct labor rate variance $
Direct labor time variance $
Total direct labor cost variance $

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