Manufacturing company Alpha s.r.o. produces products Sigma and Omega. The products requires a single operation and the standards for this operation is presented in the following table:

Standards	Sigma	Omega
Direct material - standard usage (kg/unit)	2	4
Direct material - standard purchasing price (CZK/kg)	9	9
Standard direct labour hours (DLH/unit)	2	3
Direct labour wage standard rate (CZK/DLH)	11	11
Variable overhead rate (CZK/DLH)	5	5
Total standard variable cost (CZK/unit)	50	84
Standard selling price (CZK/unit)	88	108

Alpha s.r.o. planned to produce and sell 7,500 units of Sigma and 3,400 units of Omega in the month of April. The monthly budgeted fixed overheads amounted to 310,000 CZK. The company uses a variable costing system for internal profit measurement purposes and inventory evaluation. The actual results of Alpha s.r.o. expressed in Czech Crowns (=CZK) for the April are as follows:

Sales		1,006,800
Direct material	288,000
Direct labour	261,144
Variable overheads	108,810	657,954
Contribution margin		348,846
Fixed overheads		312,108
Actual profit		36,738

Actual production and sales in April were 8,200 units of Sigma (sold at 90 CZK/unit) and 2,400 units of Sigma (sold at 112 CZK/unit). 1. Standard contribution margin per 1 unit of product Omega

2. Calculate budgeted sales of the whole company.

3. Calculate the budgeted profit of the whole company.

4.Assuming a constant sales mix, calculate the budgeted sales in CZK that correspond to the break-even point (BEP).

5. Assuming a constant sales mix, compute the budgeted safety margin in percentage terms for the whole company..

% of budgeted safety margin = ?

6. Allocate budgeted fixed cost to 1 unit of product Sigma using direct labour hours as an allocation base.

Budgeted fixed cost per 1 unit of Sigma = ? 7.Calculate standard cost per 1 unit of product Sigma using direct labour hours as an allocation base for both overheads

8. Compute total profit variance and decide whether the variance is adverse or favourable (A/F).

Total profit variance = ? 9. For product Omega, compute sales contribution margin volume variance and decide whether the variance is adverse or favourable (A/F) and decide whether the variance is adverse or favourable (A/F).

10. For both products, compute the sales price variances and decide whether the variance is adverse or favourable (A/F).

11. For both products, compute the total direct labour variance and decide whether the variance is adverse or favourable (A/F).

12. Compute the fixed overhead expenditure (spending) variance and decide whether the variance is adverse or favourable (A/F).

13.Compute the total variable overhead variance and decide whether the variance is adverse or favourable (A/F).

14.Compute the total direct material variance and decide whether the variance is adverse or favourable (A/F).

15. Allocate actual fixed cost to 1 unit of product Omega using actual sales as the allocation base.

16. Knowing that the actual consumption of direct materials was 28,800kg, compute for the whole company the direct material usage variance and decide whether the variance is adverse or favourable (A/F).

17. Based on your results, identify the biggest issue (most important factor) in achieving budgeted profit in reality.

Main problem = ?