Question
I don't know how to get the calculations for the standard quanity Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing.
I don't know how to get the calculations for the standard quanity
Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The company carries no inventories. The master budget calls for the company to manufacture and sell 124,000 liters at a budgeted price of $255 per liter this year. The standard direct cost sheet for one liter of the preservative follows.
Direct materials (2 pounds @ $16) $ 32 Direct labor (0.5 hours @ $48) 24
Variable overhead is applied based on direct labor hours. The variable overhead rate is $140 per direct-labor hour. The fixed overhead rate (at the master budget level of activity) is $70 per unit. All non-manufacturing costs are fixed and are budgeted at $2.4 million for the coming year. At the end of the year, the costs analyst reported that the sales activity variance for the year was $774,000 unfavorable. he following is the actual income statement (in thousands of dollars) for the year. Sales revenue $ 30,398 Less variable costs Direct materials 3,298 Direct labor 2,810 Variable overhead 7,830 Total variable costs $ 13,938 Contribution margin $ 16,460 Less fixed costs Fixed manufacturing overhead 1,170 Non-manufacturing costs 1,350 Total fixed costs $ 2,520 Operating profit $ 13,940 During the year, the company purchased 200,000 pounds of material and employed 52,400 hours of direct labor. Required: a. Compute the direct material price and efficiency variances. b. Compute the direct labor price and efficiency variances. c. Compute the variable overhead price and efficiency variances.
A. Direct Material
Price Variance 98000 Efficiency Variance I don't know how to calculate the standard quanity
B. Direct Labor
Price Variance = Help Efficiency Variance= Help
C. Variable Overhead
Price Variance Help Efficiency Variance Help
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