Problem 9-18 Comprehensive Variance Analysis (L09-4, LO9-5, LO9-6) Miller Toy Company manufactures a plastic swimming pool at its Westwood Plant. The plant has been experiencing problems as shown by its June contribution format income statement below: 1 Flexible Budget Actual $ 175,000 $175,000 Sales (3,000 pools) Variable expenses: Variable cost of goods sold" Variable selling expenses Total variable expenses Contribution margin Fixed expenses: Manufacturing overhead Selling and administrative Total fixed expenses Net operating income (loss) 24,300 10,000 34,300 140,700 58,310 10,000 68,310 106,690 50,000 50,000 65,eee 65, cee 115, eee 115,000 $ 25,700 5 (8,310) *Contains direct materials, direct labor, and variable manufacturing overhead, Iannt Dunn har kunt han Check my worl ok * Contains direct materials, direct labor, and variable manufacturing overhead. Janet Dunn, who has just been appointed general manager of the Westwood Plant, has been given instructions to "get things under control." Upon reviewing the plant's income statement, Ms. Dunn has concluded that the major problem lies in the variable cost of goods sold. She has been provided with the following standard cost per swimming pool Standard Quantity or Standard Price Standard Hours or Rate Cost Direct materials 3.0 pounds $ 2.00 per pound $ 6.00 Direct labor 0.3 hours $ 6.00 per hour 1.80 Variable manufacturing overhead e.2 hours" $ 1.50 per hour 0.30 Total standard cost per unit $ 8.10 Based on machine-hours. During June the plant produced 3,000 pools and incurred the following costs: a. Purchased 23,000 pounds of materials at a cost of $3.20 per pound b. Used 8,800 pounds of materials in production (Finished goods and work in process inventories are insignificant and can be ignored.) c. Worked 2.000 direct labor-hours at a cost of $5.70 per hour. d. Incurred variable manufacturing overhead cost totaling $1710 for the month. A total of 900 machine-hours was recorded nces