ONLY ANSWER THE SENTENCE PLEASE

Genuine Spice Inc. began operations on January 1 of the current year. The company produces eight-ounce bottles of hand and body lotion 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: DIRECT MATERIALS Cost Behavior Units per Case Cost per Unit Cost per Case Cream base Variable 100 oz. $0.02 $ 2.00 Natural oils Variable 30 OZ 0.30 9.00 Bottle (8-oz.) Variable 12 bottles 0.50 6.00 $17.00 DIRECT LABOR 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 Supplies Fixed 660 $19,560 Part A-Break-Even Analysis The management of Genuine Spice Inc. wants to determine the number of cases required to break even per month. The utilities cost, which is part of factory overhead, is a mixed cost. The following information was gathered from the first six months of operation regarding this cost Case Production Utility Total Cost January 500 $600 February 800 660 March 1,200 740 April 1,100 720 May 950 690 June 1,025 705 Required-Part A: 1. Determine the fixed and variable portion of the utility cost using the high-low method. 2. Determine the contribution margin per case. 3. Determine the fixed costs per month, including the utility fixed cost from part (1) 4. Determine the break-even number of cases per month. Part B-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 $12,000 Estimated finished goods inventory, August 1 Desired finished goods inventory, August 31 175 7,000 Materials Inventory: Bottles Cream Base (oz.) Oils (oz.) (bottles) 250 290 600 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. Prepare 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 (O) will be cleared automatically by CNOW.)* 9. Prepare the August budgeted income statement, including selling expenses. NOTE: Because you are not required to prepare a cost of goods sold budget, the cost of goods sold calculations will be part of the budgeted income statement.* *Enter all amounts as positive numbers. Part C-August 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 Quantity per Case Cream base $0.016 per oz. 102 oz. Natural oils $0.32 per oz. 31 oz Bottle (8-oz.) $0.42 per bottle 12.5 bottles Actual Direct Labor Actual Direct Labor Rate 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 The prices of the materials were different from 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 month, thus causing the actual labor rate to exceed standard. The Filling 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. 11. Determine and interpret the direct labor rate and time variances for the two departments. Round hours to the nearest tenth of an hour. 12. Determine and interpret the factory overhead controllable variance. 13. Determine and interpret the factory overhead volume variance. 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 1,375 cases of production used in the budgets for parts (6) and (7)? 1. Determine the fixed and variable portion of the utility cost using the high-low method. Variable cost per unit Total fixed cost At High Point $240.00 X $500.00 $740.00 At Low Point $100.00 x $500.00 $600.00 Total cost Points: 4/6 Feedback Check My Work 1. Divide the difference between the highest and lowest total costs by the difference between the highest and lowest production units. Multiply the variable unit cost by the number of units for a month. Subtract this variable cost from the month's total cost. Genuine Spice Inc. Direct Labor Cost Budget For the Month Ended August 31 Mixing Filling Total Units required for production of hand and body lotion X 458 115 V $18.00 $14.00 x X Hourly rate Total direct labor cost $8,244 $1,656 $9,900 Points: 8/ 10 Feedback Check My Work 7. Multiply labor hours required by the direct labor rate. 9. Prepare the August budgeted income statement, including selling expenses. Enter all amounts as positive numbers. NOTE: Because you are not required statement Genuine Spice Inc. Budgeted Income Statement For the Month Ended August 31 Revenue from sales $150,000 Finished goods inventory, August 1 $12,000 Direct materials: Direct materials inventory, August 1 $392 Direct materials purchases 23,231 $23,623 v Cost of direct materials available for use Less direct materials inventory, August 31 Cost of direct materials placed in production 248 $23,375 Direct labor 9,900 Factory overhead 19,735 Cost of goods manufactured 23,375 X 9,900 X Cost of finished goods available for sale Less finished goods inventory, August 31 7,000 Cost of goods sold 58,010 Gross profit $91,990 2nnnn 10. Determine and interpret the direct materials price and quantity variances for the three materials. Enter a favorable variance as a negative amount, and an unfavorable variance as a Direct Materials Price Variance Cream Base Natural Oils Bottles $ $ Difference $ $ $ Direct materials price variance $ $ $ Direct Materials Quantity Variance Cream Base Natural Oils Bottles Difference $ Direct materials quantity variance $ $ $ The fluctuation in caused the direct material price variances. All the quantity variances were indicating Feedback Check My Work 10. Price variance is the difference between the actual and standard prices, multiplied by the actual quantity. Quantity variance is the difference between the actual and standard quantities, multiplied by the standard price. What cause variances? 11. Determine and interpret the direct labor rate and time variances for the two departments. Round hours to the nearest tenth of an hour. Enter a favorable variance as a negative amount, and an unfavorable variance as a positive amount. Direct Labor Rate Variance Mixing Department Filling Department $ $ Difference $ $ X Direct labor rate variance $ $ Direct Labor Time Variance Mixing Department Filling Department Difference Direct labor time variance $ The change in the caused the labor rate variances. This change have been responsible for the direct labor time variance. Feedback Check My Work 11. Labor rate variance is the difference between the actual and standard hourly rates, multiplied by the actual hours. Time variance is the difference between the actual an time variances? 12. Determine and interpret the factory overhead controllable variance. Enter a favorable variance as a negative amount, and an unfavorable variance as a positive amount. Factory Overhead Controllable Variance $ Factory overhead controllable variance $ The factory overhead controllable variance was caused by the variance in 13. Determine and interpret the factory overhead volume variance. Round rate to four decimal places. Enter a favorable variance as a negative amount, and an unfavorable variance as a positive amount. Factory Overhead Volume Variance Normal volume (cases) Actual volume (cases) Difference X $ Factory overhead volume variance $ Points: The volume variance indicates the cost of Points: Feedback Check My Work 13. Overhead volume variance is the difference between the normal production capacity and the actual units produced, multiplied by the fixed overhead rate. What caused the volume variance? 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 1,375 cases of production used in the budgets for parts (6) and (7)? Genuine Spice Inc. began operations on January 1 of the current year. The company produces eight-ounce bottles of hand and body lotion 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: DIRECT MATERIALS Cost Behavior Units per Case Cost per Unit Cost per Case Cream base Variable 100 oz. $0.02 $ 2.00 Natural oils Variable 30 OZ 0.30 9.00 Bottle (8-oz.) Variable 12 bottles 0.50 6.00 $17.00 DIRECT LABOR 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 Supplies Fixed 660 $19,560 Part A-Break-Even Analysis The management of Genuine Spice Inc. wants to determine the number of cases required to break even per month. The utilities cost, which is part of factory overhead, is a mixed cost. The following information was gathered from the first six months of operation regarding this cost Case Production Utility Total Cost January 500 $600 February 800 660 March 1,200 740 April 1,100 720 May 950 690 June 1,025 705 Required-Part A: 1. Determine the fixed and variable portion of the utility cost using the high-low method. 2. Determine the contribution margin per case. 3. Determine the fixed costs per month, including the utility fixed cost from part (1) 4. Determine the break-even number of cases per month. Part B-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 $12,000 Estimated finished goods inventory, August 1 Desired finished goods inventory, August 31 175 7,000 Materials Inventory: Bottles Cream Base (oz.) Oils (oz.) (bottles) 250 290 600 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. Prepare 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 (O) will be cleared automatically by CNOW.)* 9. Prepare the August budgeted income statement, including selling expenses. NOTE: Because you are not required to prepare a cost of goods sold budget, the cost of goods sold calculations will be part of the budgeted income statement.* *Enter all amounts as positive numbers. Part C-August 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 Quantity per Case Cream base $0.016 per oz. 102 oz. Natural oils $0.32 per oz. 31 oz Bottle (8-oz.) $0.42 per bottle 12.5 bottles Actual Direct Labor Actual Direct Labor Rate 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 The prices of the materials were different from 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 month, thus causing the actual labor rate to exceed standard. The Filling 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. 11. Determine and interpret the direct labor rate and time variances for the two departments. Round hours to the nearest tenth of an hour. 12. Determine and interpret the factory overhead controllable variance. 13. Determine and interpret the factory overhead volume variance. 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 1,375 cases of production used in the budgets for parts (6) and (7)? 1. Determine the fixed and variable portion of the utility cost using the high-low method. Variable cost per unit Total fixed cost At High Point $240.00 X $500.00 $740.00 At Low Point $100.00 x $500.00 $600.00 Total cost Points: 4/6 Feedback Check My Work 1. Divide the difference between the highest and lowest total costs by the difference between the highest and lowest production units. Multiply the variable unit cost by the number of units for a month. Subtract this variable cost from the month's total cost. Genuine Spice Inc. Direct Labor Cost Budget For the Month Ended August 31 Mixing Filling Total Units required for production of hand and body lotion X 458 115 V $18.00 $14.00 x X Hourly rate Total direct labor cost $8,244 $1,656 $9,900 Points: 8/ 10 Feedback Check My Work 7. Multiply labor hours required by the direct labor rate. 9. Prepare the August budgeted income statement, including selling expenses. Enter all amounts as positive numbers. NOTE: Because you are not required statement Genuine Spice Inc. Budgeted Income Statement For the Month Ended August 31 Revenue from sales $150,000 Finished goods inventory, August 1 $12,000 Direct materials: Direct materials inventory, August 1 $392 Direct materials purchases 23,231 $23,623 v Cost of direct materials available for use Less direct materials inventory, August 31 Cost of direct materials placed in production 248 $23,375 Direct labor 9,900 Factory overhead 19,735 Cost of goods manufactured 23,375 X 9,900 X Cost of finished goods available for sale Less finished goods inventory, August 31 7,000 Cost of goods sold 58,010 Gross profit $91,990 2nnnn 10. Determine and interpret the direct materials price and quantity variances for the three materials. Enter a favorable variance as a negative amount, and an unfavorable variance as a Direct Materials Price Variance Cream Base Natural Oils Bottles $ $ Difference $ $ $ Direct materials price variance $ $ $ Direct Materials Quantity Variance Cream Base Natural Oils Bottles Difference $ Direct materials quantity variance $ $ $ The fluctuation in caused the direct material price variances. All the quantity variances were indicating Feedback Check My Work 10. Price variance is the difference between the actual and standard prices, multiplied by the actual quantity. Quantity variance is the difference between the actual and standard quantities, multiplied by the standard price. What cause variances? 11. Determine and interpret the direct labor rate and time variances for the two departments. Round hours to the nearest tenth of an hour. Enter a favorable variance as a negative amount, and an unfavorable variance as a positive amount. Direct Labor Rate Variance Mixing Department Filling Department $ $ Difference $ $ X Direct labor rate variance $ $ Direct Labor Time Variance Mixing Department Filling Department Difference Direct labor time variance $ The change in the caused the labor rate variances. This change have been responsible for the direct labor time variance. Feedback Check My Work 11. Labor rate variance is the difference between the actual and standard hourly rates, multiplied by the actual hours. Time variance is the difference between the actual an time variances? 12. Determine and interpret the factory overhead controllable variance. Enter a favorable variance as a negative amount, and an unfavorable variance as a positive amount. Factory Overhead Controllable Variance $ Factory overhead controllable variance $ The factory overhead controllable variance was caused by the variance in 13. Determine and interpret the factory overhead volume variance. Round rate to four decimal places. Enter a favorable variance as a negative amount, and an unfavorable variance as a positive amount. Factory Overhead Volume Variance Normal volume (cases) Actual volume (cases) Difference X $ Factory overhead volume variance $ Points: The volume variance indicates the cost of Points: Feedback Check My Work 13. Overhead volume variance is the difference between the normal production capacity and the actual units produced, multiplied by the fixed overhead rate. What caused the volume variance? 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 1,375 cases of production used in the budgets for parts (6) and (7)