Lexi Belcher picked up the monthly report that Irvin Santamaria left on her desk. She smiled as her eyes went straight to the bottom line of the report and saw the favorable variance for operating income, confirming her decision to push the workers to get those last 270 cases off the production line before the end of the month. But as she glanced over the rest of numbers, Lexi couldn't help but wonder if there were errors in some of the line items. She was puzzled at how most of the operating expenses could be higher than the budget since she had worked hard to manage the production line to improve efficiency and reduce costs. Yet the report shown below, showed a different story. Variance Cases produced and sold Actual Budget 10,2509 ,980 $1,943,600 $1,866,300 270 Favorable $77,300 Favorable Sales revenue Less variable expenses Direct material 548,900 10,978 Unfavorable 559,878 267,115 Direct labor 259,480 Variable manufacturing overhead 284.442 7.635 Unfavorable 5,002 Unfavorable 3,124 Unfavorable Variable selling expenses 92,944 Variable administrative expenses 279,440 89,820 39.920 1.217,560 648,740 41,657 1.246,036 697,564 Total variable expense 1,737 Unfavorable 28,476 Unfavorable 48,824 Favorable Contribution margin Less fixed expenses Fixed manufacturing overhead 109,780 Fixed selling expenses 110,778 69,361 129,540 309,679 $387,885 998 Unfavorable (499 Favorable) (200 Favorable) Fixed administrative expenses 69,860 129,740 309,380 $339,360 Total fixed expense 299 Unfavorable Operating income $48,525 Favorable Activate Windows Go to Settings to activate Windows. Lexi picked up the phone and called Irvin. "Irvin, I don't get it. We beat the budgeted operating income for the month, but look at all the unfavorable variances on the operating costs. Can you help me understand what's going on?" "Let me look into it and I'll get back to you." Irvin replied. Irvin gathered the following additional information about the month's performance. Direct materials purchased: 101,796 pounds at a total of $559,878 Direct materials used: 101,796 pounds Direct labor hours worked: 26.447 at a total cost of $267.115 Machine hours used: 40,868 Irvin also found the standard cost card for a case of product. Standard Price $5.50 per pound $10 per DLH Direct materials Standard Cost $55 25.90 Standard Quantity 10 pounds 2.59 DLH Direct labor Variable overhead $7 per MH $2.74 per MH MH 4MH 28.00 10.96 Fixed overhead Total standard cost per case $119.86 (a-b) Calculate the direct material price variance and direct material quantity variance for the month. (If variance is zero, select "Not Applicable" and enter for the amounts.) Direct material price variance Direct material quantity variance $ $ (c-d) Calculate the direct labor rate variance and direct labor efficiency variance for the month. (Round answers to decimal places, e.g. 1,525. If variance is zero, select "Not Applicable" and enter for the amounts.) Direct labor rate variance Direct labor efficiency variance $ $ (e-f) Calculate the variable overhead spending variance and variable overhead efficiency variance for the month. (If variance is zero Variable overhead spending variance Variable overhead efficiency variance $ $ (g) Calculate the fixed overhead spending variance for the month (If variance is zero, select "Not Applicable and enter for the amounts.) Fixed overhead spending variance eTextbook and Media Prepare a performance report that will assist Lexi in evaluating her efforts to control production costs. (If variance is zero, select "Not Applicable and enter for the amounts.) Price/Rate/Spending Variance Quantity/Efficiency Variance Direct materials $ Direct labor Variable overhead Fixed overhead Total eTextbook and Media Based on your review of the performance report you prepared, do you think Lexi did a good job of controlling production expenses during the month? Lexi Belcher picked up the monthly report that Irvin Santamaria left on her desk. She smiled as her eyes went straight to the bottom line of the report and saw the favorable variance for operating income, confirming her decision to push the workers to get those last 270 cases off the production line before the end of the month. But as she glanced over the rest of numbers, Lexi couldn't help but wonder if there were errors in some of the line items. She was puzzled at how most of the operating expenses could be higher than the budget since she had worked hard to manage the production line to improve efficiency and reduce costs. Yet the report shown below, showed a different story. Variance Cases produced and sold Actual Budget 10,2509 ,980 $1,943,600 $1,866,300 270 Favorable $77,300 Favorable Sales revenue Less variable expenses Direct material 548,900 10,978 Unfavorable 559,878 267,115 Direct labor 259,480 Variable manufacturing overhead 284.442 7.635 Unfavorable 5,002 Unfavorable 3,124 Unfavorable Variable selling expenses 92,944 Variable administrative expenses 279,440 89,820 39.920 1.217,560 648,740 41,657 1.246,036 697,564 Total variable expense 1,737 Unfavorable 28,476 Unfavorable 48,824 Favorable Contribution margin Less fixed expenses Fixed manufacturing overhead 109,780 Fixed selling expenses 110,778 69,361 129,540 309,679 $387,885 998 Unfavorable (499 Favorable) (200 Favorable) Fixed administrative expenses 69,860 129,740 309,380 $339,360 Total fixed expense 299 Unfavorable Operating income $48,525 Favorable Activate Windows Go to Settings to activate Windows. Lexi picked up the phone and called Irvin. "Irvin, I don't get it. We beat the budgeted operating income for the month, but look at all the unfavorable variances on the operating costs. Can you help me understand what's going on?" "Let me look into it and I'll get back to you." Irvin replied. Irvin gathered the following additional information about the month's performance. Direct materials purchased: 101,796 pounds at a total of $559,878 Direct materials used: 101,796 pounds Direct labor hours worked: 26.447 at a total cost of $267.115 Machine hours used: 40,868 Irvin also found the standard cost card for a case of product. Standard Price $5.50 per pound $10 per DLH Direct materials Standard Cost $55 25.90 Standard Quantity 10 pounds 2.59 DLH Direct labor Variable overhead $7 per MH $2.74 per MH MH 4MH 28.00 10.96 Fixed overhead Total standard cost per case $119.86 (a-b) Calculate the direct material price variance and direct material quantity variance for the month. (If variance is zero, select "Not Applicable" and enter for the amounts.) Direct material price variance Direct material quantity variance $ $ (c-d) Calculate the direct labor rate variance and direct labor efficiency variance for the month. (Round answers to decimal places, e.g. 1,525. If variance is zero, select "Not Applicable" and enter for the amounts.) Direct labor rate variance Direct labor efficiency variance $ $ (e-f) Calculate the variable overhead spending variance and variable overhead efficiency variance for the month. (If variance is zero Variable overhead spending variance Variable overhead efficiency variance $ $ (g) Calculate the fixed overhead spending variance for the month (If variance is zero, select "Not Applicable and enter for the amounts.) Fixed overhead spending variance eTextbook and Media Prepare a performance report that will assist Lexi in evaluating her efforts to control production costs. (If variance is zero, select "Not Applicable and enter for the amounts.) Price/Rate/Spending Variance Quantity/Efficiency Variance Direct materials $ Direct labor Variable overhead Fixed overhead Total eTextbook and Media Based on your review of the performance report you prepared, do you think Lexi did a good job of controlling production expenses during the month