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Please analyze the following company information: Revenue & Spending Activity Actual Variances Flexible Variances Planning Quantity Sold 400 400 356 Total Revenues $20,800,000 $1,200,000 U
Please analyze the following company information: | |||||||
Revenue & | |||||||
Spending | Activity | ||||||
Actual | Variances | Flexible | Variances | Planning | |||
Quantity Sold | 400 | 400 | 356 | ||||
Total Revenues | $20,800,000 | $1,200,000 | U | $22,000,000 | $2,420,000 | F | $19,580,000 |
Total Variable Costs | $5,200,000 | $300,000 | F | $5,500,000 | $605,000 | U | $4,895,000 |
Total Fixed Costs | $7,000,000 | $500,000 | F | $7,500,000 | $ - | $7,500,000 | |
Total Profit | $8,600,000 | $400,000 | U | $9,000,000 | $1,815,000 | F | $7,185,000 |
The $300,000 Favorable Spending Variance for Total Variable Costs consists of the following: | |||||||
Direct material price variance | 800000 | U | |||||
Direct material efficiency variance | 800000 | F | |||||
Direct labor price variance | 0 | ||||||
Direct labor efficiency variance | 300000 | F | |||||
Indicate for each statement whether or not it is supported by the data provided above. | |||||||
If the statement is consistent with the data above, answer "T". If not, answer "F". | |||||||
Higher actual total variable costs versus budgeted total variable costs is driven by higher production than expected. | |||||||
The company paid more for its direct material per pound, but this resulted in less rework and therefore saved time and material. | |||||||
The company paid less per labor per hour than budgeted. | |||||||
The company's profit was $400,000 lower than budgeted before the period started. | |||||||
The company did a good job managing their fixed costs. | |||||||
The average price received was lower than budgeted. |
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