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 Light Chocolate 8 lbs. Cocoa Sugar Standard labor time Actual production (cases) Cocoa Sugar Dark Chocolate 12 lbs. a. 10 lbs. 0.50 hr. Dark Chocolate Light Chocolate Planned production 4,700 cases 11,000 cases Standard labor rate $15.50 per hr. $15.50 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 10,000 5,000 Actual Price per Pound $7.33 1.35 Actual Labor Rate Direct materials price variance Direct materials quantity variance 14 lbs. 0.60 hr. $15.25 per hr. 15.80 per hr. Dark chocolate Light chocolate 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. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. a. Direct materials price variance, direct materials quantity variance, and total variance. b. Direct labor rate variance, direct labor time variance, and total variance. Standard Price per Pound $7.25 1.40 Actual Pounds Purchased and Used 140,300 188,000 Actual Labor Hours Used 2,360 6,120 -3,760 X

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