Instructions Genuine Spice Inc. began operations on January 1 of the current year. The company produces Bounce bottles at hand and body lotion called Eternal Beauty. The lotion is sold wholesale in 12-bottle cases for S100 per case. There is a selling commission of $20 per case. The January direct materials, direct labor, and factory overhead costs are as follows: DIRECT MATERIALS Cost Behavior Units per Case Cost per Unit Cost per Case Cream base Variable 100 TS $0.02 $2.00 Natural oils Variable 30 0.30 9.00 Bottle (8-oz.) Vanable 12 bottles 0.50 6.00 $17.00 DIRECT LABOR Department Cost Behavior Time per Case Laborate per Hour Cost per Case Instructions DINCELADUR Department Cost Behavior Time per Case Labor Rate per Hour Cost per Case Mixing Variable 20 min. $18.00 $6.00 Filling Variable 5 14.40 1:20 25 min $7.20 FACTORY OVERHEAD Cost Behavior Total Cost Utilities Mixed $600 Facility lease Fixed 14.000 Equipment depreciation Fixed 4,300 Foced 560 Supplies $19,560 Instructions Part 8-August Budgets During July of the current year, the management of Genuine Spice Inc, asked the controller to prepare August manufacturing and income statement budgets. Demand was expected to be 1,500 cases at $100 per case for August. Inventory planning information is provided as follows: Finished Goods Inventory Cases Cost 300 Estimated finished goods inventory, August 1 Desired finished goods inventory, August 31 512.000 7.000 175 Materials inventory Cream Base (oz.) Oils Bottles (os) (bottles) 290 500 250 Estimated materials inventory, August 1 Desired materials inventory, August 31 1.000 360 240 Instructions Cream Base (ozs.) Olls Bottles (ozs.) (bottles) 290 600 250 Estimated materials inventory, August 1 Desired materials inventory, August 31 1,000 360 240 There was negligible work in process inventory assumed for either the beginning or end of the month; thus, none was assumed. In addition, there was no change in the cost per unit or estimated units per case operating data from January Required-Part B: 5. Prepare the August production budget." 6. Prepare the August direct materials purchases budget. 7. Propare the August direct labor cost budget. Round the hours required for production to the nearest hour 8. Prepare the August factory overhead cost budget. If an amount box does not require an entry, leave it blank (Entries of zero (0) will be cleared automatically by CNOW) 9. Propare the August budgeted income statement, including selling expenses. Enter all amounts as positive numbers, Budgeted Income Statement 9. Propare the August budgeted income statement, including selling expenses. Enter all amounts as positive numbers Genuine Spice Inc. Budgeted Income Statement For the Month Ended August 31 $137,500 x Sales $12,000 Finished goods inventory, August 1 $392 23,231 Direct materials inventory, August 1 Direct materials purchases Direct materials inventory, August 31 Cost af direct materials for production 248 $23,375 Direct labor 9,900 19,735 53,010 V Factory overhead 7.000 Finished goods inventory, August 31 23,231 Budgeted Income Statement Direct materials purchases Direct materials inventory, August 31 Cost of direct materials for production 248 $23,375 Direct labor 9,900 19,735 53,010 V Factory overhead Finished goods Inventory, August 31 Cost of goods sold 7,000 58,010 Gross profit $79,490 X Sning expenses 79,480 x Income before income tax $51.990 X Amount Descriptions Question Instructions Part C-August Variance Analysis During September of the current year, the controller was asked to perform variance analyses for August. The January operating diata provided the standard prices, rates, times, and quantities per case. There were 1,500 actual cases produced Qpring 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 Quantity per Case Cream base 30.016 por oz. 102 os. Natural oils $0.32 per oz 31.07 Bottle (8-02) $0.42 per bottle 125 bottles Actual Direct Labor Rate Actual Direct Labor Time por Case 19.50 min $18.20 Miding Filling 14.00 5.60 min Instructions Labor Rate $18.20 Mbing Filling Time per Case 19.50 min. 5.60 min 14.00 na Actual variable overhead Normal volume $305.00 1,600 cases The prices of the materials were different than standard due to fluctuations in market prices. The standard quantity of materials used per case was an ideal standard. The Mixing Department used a higher grade labor classification during the months, thus causing the actual labor rate to exceed standard. The Filing Department used a lower grade labor classification during the month, thus causing the actual labor rate to be less than standard. Required-Part C: 10. Determine and interpret the direct materials price and quantity variances for the three materials. Round your price values for Cream Base to three decimal places and Natural Oils & Bottles to two decimal places." 11. Determine and interpret the direct labor rate and time variances for the two departments. Do nat round hours. Round your answers to two decimal places 12 namin an instant this factant nunhaar man vara Required-Part C: 10. Determine and interpret the direct materials price and quantity variances for the three materials. Round your price values for Cream Base to three decimal places and Natural Oils & Bottles to two decimal places. 11. Determine and interpret the direct labor rate and time variances for the two departments. Do not round hours. Round your answers to two decimal places 12. Determine and interpret the factory overhead controllable variance. 13. Determine and interpret the factory overhead volume variance. Round rate to four decimal places and round your final answer to two decimal places 14. Why are the standard direct labor and direct materials costs in the calculations for parts (10) and (11) based on the actual 1,500-case production volume rather than the planned 1,250 cases of production used in the budgets for parts (6) and (7)? "Negative amount should be indicated by the minus sign. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number act Variance Analysis (Part 10. Datormine and interpret the direct materials pnce and quantity variances for the three materials Negative amount should be indicated by the minus son Enter a favorable variance as a negative rumber using a minus sign and an untevorable variano as a positive number. Hound your price values for Crmarn Base to three decimal places and Natural Bomes to two decimal places Direct Materials Price Variance Cream Base Natural Oils Bottles $ Offerte 3 Oct me ince variance Points 0724