Question
Genuine Spice Inc. began operations on January 1, 2016. The company produces a hand and body lotion in an eight-ounce bottle called Eternal Beauty .
Genuine Spice Inc. began operations on January 1, 2016. The company produces a hand and body lotion in an eight-ounce bottle called Eternal Beauty. The lotion is sold wholesale in 12-bottle cases for $100 per case. There is a selling commission of $20 per case. The January direct materials, direct labor, and factory overhead costs are as follows:
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Part CAugust Variance Analysis
During September of the current year, the controller was asked to perform variance analyses for August. The January operating data provided the standard prices, rates, times, and quantities per case. There were 1,500 actual cases produced during August, which was 250 more cases than planned at the beginning of the month. Actual data for August were as follows:
Actual Direct Materials Price per Unit | Actual Direct Materials Quantity per Case | |||
Cream base | $0.016 | per oz. | 102 | ozs. |
Natural oils | $0.32 | per oz. | 31 | ozs. |
Bottle (8-oz.) | $0.42 | per bottle | 12.5 | bottles |
Actual Direct Labor Rate | Actual Direct Labor Time per Case | |
Mixing | $18.20 | 19.50 min. |
Filling | 14.00 | 5.60 min. |
Actual variable overhead | $305.00 | |
Normal volume | 1,600 cases |
Determine and interpret the factory overhead controllable variance. Enter all amounts as positive numbers.
Actual variable overhead | $ |
Variable overhead at standard cost | |
Factory overhead controllable variance | $ |
Indicate if favorable or unfavorable |
13. Determine and interpret the factory overhead volume variance. When determining the fixed factory overhead rate. Round the factory overhead rate to two decimal places and and the factory overhead volume variance to whole dollars. Enter all amounts as positive numbers.
Normal volume (cases) | |
Actual volume (cases) | |
Difference | |
Fixed factory overhead rate | $ |
Factory overhead volume variance | $ |
Indicate if favorable or unfavorable |
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