please read all of the attached pictures to answer all 3 questions at the bottom using same data
Case 11-55 Comprehensive Variance Analysis Used to explain Operational Results; Review of Chapters 10 and 11; Activity-Based Costing; Sales Variances (Appendix B) (LO 11-4, 11-5, 11-7, 11-9) [The following information applies to the questions displayed below.) Colonial Cookies, Inc., bakes cookies for retail stores. The company's best-selling cookle is chocolate nut supreme which is marketed as a gourmet cookle and regularly sells for $8.00 per pound. The standard cost per pound of chocolate nut supreme, based on Colonlal's normal monthly production of 240,000 pounds, is as follows: Quantity Total Cost Cost Item Direct materials: Cookie mix Milk chocolate Almonds 10 oz. 5 oz. 1 oz. Standard Unit Cost $ .06 per oz. 19 per oz. .54 per oz. $ .60 .95 .54 $2.09 Direct labor Mixing Baking 1 min. 2 min. 14.40 per hr. 18.00 per hr. $ .24 .60 $ .84 Variable overheadt 3 min. 32.40 per direct-labor hr. $ 1.62 Total standard cost per pound $4.55 "Direct-labor rates include employee benefits. tApplied on the basis of direct-labor hours. Colonial's management accountant, Karen Blair, prepares monthly budget reports based on these standard costs. February's contribution report, which compares budgeted and actual performance, is shown in the following schedule. Contribution Report for February Static Budget Actual Variance Units (in pounds) 240,000 265,000 25,000 F Revenue $1,920,000 $2,093,500 $173,500 F Direct material Direct labor Variable overhead $ 501,600 $ 691,500 $189,900 U 201,600 204,960 3,360 U 388,800 441,667 52,867 U Total variable costs $1,092,000 $ 1,338,127 $ 246,127 U Contribution margin $ 828,000 $ 755,373 $ 72,627 U Justine Madison, president of the company, is disappointed with the results. Despite a sizable increase in the number of cookies sold, the product's expected contribution to the overall profitability of the firm decreased. Madison has asked Blair to identify the reason why the contribution margin decreased. Blair has gathered the following information to help in her analvsis of the decrease. Justine Madison, president of the company, is disappointed with the results. Despite a sizable increase in the number of cookies sold, the product's expected contribution to the overall profitability of the firm decreased. Madison has asked Blair to identify the reason why the contribution margin decreased. Blair has gathered the following information to help in her analysis of the decrease. Usage Report for February Cost Item Quantity Actual Cost Direct materials: Cookie mix 2,725,000 oz. $ 163,500 Milk chocolate 1,570,000 oz. 376,800 Almonds 280,000 oz. 151,200 Direct labor Mixing 265,000 min. 63,600 Baking 471,200 min. 141,360 Variable overhead 441,667 Total variable costs $1,338,127 Case 11-55 Part 1 Required: 1. Prepare a new contribution report for February, in which: . . The static budget column in the contribution report is replaced with a flexible budget column. The variances in the contribution report are recomputed as the difference between the flexible budget and actual columns. (Do not round your intermediate calculations. Indicate the effect of each variance by selecting "Favorable" or "Unfavorable". Select "None" and enter "O" for no effect (I.e., zero variance).) Flexible Budget Actual Variance Units (in pounds) Revenue Direct material Direct labor Variable overhead Total variable costs Contribution margin Case 11-55 Part 2 2. What is the total contribution margin in the flexible budget column of the new report prepared for part (1)? (Do not round your intermediate calculations. Round your final answer to the nearest whole dollar amount.) Total contribution margin Case 11-55 Part 4 4. What is the total variance between the flexible budget contribution margin and the actual contribution margin in the new report prepared for part (1)? Calculate the total contribution margin variance by computing the following variances. (Assume that all materials are used in the month of purchase.). (Do not round your Intermediate calculations. Indicate the effect of each variance by selecting "Favorable" or "Unfavorable". Select "None" and enter "O" for no effect (.e., zero variance).) a. Direct-material price variance. b. Direct-material quantity variance. c. Direct-labor rate variance. d. Direct-labor efficiency variance. e. Variable-overhead spending variance. f. Variable-overhead efficiency variance. g. Sales-price variance. Total Favorable Unfavorable None
