Part A. Break-even Analysis Part B. Budgets Utility Total Month January Case Productic Cost Finished Goods Inventory 500 $ 600.00 February 800 $ 660.00 March 1,200 $ 740.00 April 1,100 $ 720.00 May 950 690.00 June 1,025 $ 705.00 Cases Estimated finished goods inventory, Augi Desired finished goods inventory, Augus 300 175 Cost $12,000.00 $ 7,000.00 Materials Inventory Instructions Estimated materials inventory, August 1 Desired materials inventory, August 31 1,000 Cream Base (oz.) Oils (oz.) Bottels (oz.) 250 290 600 240 360 1. Determine the fixed and variable portion of the utility cost using the high-low 2. Determine the contrinution margin per case. 3. Determine the fixed costs per month, including the utility fixed cost from question (1). 4.Determine the break-even number of cases per month 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 operatina data from January. Instructions 5.Prepare the August production budget. 6.Prepare the August direct materials purchases budget. Part C. August Variance Analysis During September of the current year, Robin 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 Actual Direct Materials Material Materials Price per Unit Quantity per Case Cream Base $ 0.160 102 (oz.) Natural Oils (oz.) Bottles 0.32 31 0.42 12.5 Actual Direct Actual Direct Labor Time Activity Labor Rate per Case (minutes) Mixing $ 18.20 19.50 Filling $ 14.00 5.60 Actual Variable Overhead $ 305.00 Normal Volume (Cases) 1,600 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 Develop the direct materials purchases budget. Quivers Inc. Direct Materials Purchases Budget For the Month Ended August 31 Units required for production Plus desired ending inventory Total units required Less estimated beginning inventory Total materials to be purchased Unit price Total direct materials to be purchased Cream Base (oz.) Natural Oils Bottles (bottles) Total Raw Materials Units x Volume = Total Cream Base Natural Oils Bottles