The point of the this case study is too show the variances of a manufactured product and to account for the difference. The first part of the case study is to cookie Nestle Tollhouse Cookies from the yellow package (NOT premade dough). You should be able to follow the directions and track (estimate) the costs for a variance assignment. Each student should have a different answer since each batch of cookies will have different variance. I expect a posted picture of you cookies (do not use stock photos) and a spreadsheet analysis of the variances. I will post a model answer (attached).

Flour Baking Soda Salt Butter Sugar Brown Sugar Vanilla Extract Eggs Choc Chips Total Cost Amount Used UoM $2.99 2.5 Cups $1.89 1 TSP $1.09 1 TSP $4.49 2 Sticks $6.29 0.75 Cup $2.49 0.75 Cup $5.49 1 TSP $2.99 2 Each $3.00 2 Cups Amount PurchUoM 17.00 cups 96.00 TSP 156.00 TSP 8.00 Sticks 20.00 Cups 4.00 Cups 6.00 TSP 12.00 Each 2.00 Cups Cost Used $0.44 $0.02 $0.01 $1.12 $0.24 $0.47 $0.92 $0.50 $3.00 $30.72 Flex Budget Variance Actual 39 F/(U) 0 Flex Budget 39 Sales Volume Variance F/(U) Output DM Flour Baking Soda Salt Butter Sugar Brown Sugar Vanilla Extract Eggs Choc Chips 21 $0.44 $0.02 $0.01 $1.12 $0.24 $0.47 $0.92 $0.50 $3.00 $0.34 F $0.27 F $0.28 F ($0.39) U $0.05 F ($0.16) U ($0.32) U $0.28 F $0.12 F $0.78 $0.29 $0.29 $0.73 $0.29 $0.30 $0.59 $0.78 $3.12 $0.42 $0.15 $0.15 $0.39 $0.15 $0.16 $0.32 $0.42 $1.68 Total DM $6.71 $0.46 F $7.17 $3.86 F Per Cookie $0.17 Spending Variance Efficiency Variance $0.46 Favorable $3.86 Favorable F F F F F F F F F $0.18 Notes: As demonstated above, the actual number of cookies baked was way under the budgeted amout of 60. Because the volum Actual Cost Per CookieBudget Cost Per Cookie $0.01 $0.02 $0.00 $0.01 $0.00 $0.01 $0.03 $0.02 $0.01 $0.01 $0.01 $0.01 $0.02 $0.02 $0.01 $0.02 $0.08 $0.08 Budget 60 $1.20 $0.44 $0.44 $1.12 $0.44 $0.47 $0.92 $1.20 $4.80 $11.02 $0.18 d amout of 60. Because the volume of cookies was so low, this created a favorable efficiency variance of $3.86. When the flexible budg ariance of $3.86. When the flexible budget is adjusted to 39 cookies, there is favorable spending variance of $0.46. This indicates that I nding variance of $0.46. This indicates that I under-budgeted. Cost Flour Baking Soda Salt Butter Sugar Brown Sugar Vanilla Extract Eggs Choc Chips Total $2.99 $1.89 $0.79 $5.90 $2.29 $2.39 $3.99 $5.99 $3.69 $29.92 Amount Used UoM 2.25 1 1 2 0.75 0.75 1 2 2 Cups TSP TSP Sticks Cup Cup TSP Each Cups (AQ*AP) Output DM Flour Baking Soda Salt Butter Sugar Brown Sugar Vanilla Extract Eggs Choc Chips Total DM Per Cookie Spending Variance Efficiency Variance Static Budget Variance Actual 37 Amount Purchased 7.50 100.75 122.75 4.00 2.25 2.25 6.00 12.00 2.00 Cost Used $0.8970 $0.0188 $0.0064 $2.9500 $0.7633 $0.7967 $0.6651 $0.9983 $3.6900 $10.7857 (AQ*BP) Flex Budget Variance F/(U) 0 Flex Budget 37 Sales Volume Variance 23 $0.8970 $0.0188 $0.0064 $2.9500 $0.7633 $0.7967 $0.6651 $0.9983 $3.6900 ($0.1570) U $0.2524 F $0.2647 F ($2.2578) U ($0.4922) U ($0.5088) U ($0.1008) U ($0.2583) U ($0.7300) U $0.7400 $0.2712 $0.2712 $0.6922 $0.2712 $0.2879 $0.5644 $0.7400 $2.9600 $0.4600 $0.1686 $0.1686 $0.4303 $0.1686 $0.1790 $0.3508 $0.4600 $1.8400 $10.7857 ($3.9877) U $6.7979 $4.2257 $0.2915 $0.1837 ($3.9877) Unfavorable $4.2257 Favorable $0.2380 Favorable I made 37 cookies instead of 60, this is because starting with the third batch I experimented with an ice cream scoop formed but larger cookies (see photos). The static budget variance is $0.24 favorable because I purchased the ing was slightly lower than budgeted as shown in the total DM column ($10.79 vs $11.02). The fact that I only made 37 cookies at a cost close to that of what was expected to be 60 cookies, this resulted in a variance of ($3.99), but a favorable efficiency variance of $4.23. Actual Cost Per Cookie $0.0242 $0.0005 $0.0002 $0.0797 $0.0206 $0.0215 $0.0180 $0.0270 $0.0997 $0.2915 Budget Cost Per Cookie $0.0200 $0.0073 $0.0073 $0.0187 $0.0073 $0.0078 $0.0153 $0.0200 $0.0800 $0.1837 (BQ*BP) les Volume F/(U) Budget 60 F F F F F F F F F $1.2000 $0.4397 $0.4397 $1.1225 $0.4397 $0.4669 $0.9152 $1.2000 $4.8000 F $11.0237 $0.1837 mented with an ice cream scoop, this resulted in properly ble because I purchased the ingredients at on overall cost that ). be 60 cookies, this resulted in an unfavorable spending ELEMENT COST BREAKDOWN Ingredient flour baking soda salt butter sugar brown sugar vanilla extract choco chips eggs Purchased price $2.99 $0.99 $2.99 $2.99 $2.79 $1.59 $3.89 $3.49 $10.99 Purchased size (oz/UNIT) Price/oz OR unit 80 0.04 16 0.06 48 0.06 16 0.19 64 0.04 32 0.05 2 1.95 12 0.29 60 0.18 EXPECTED WEIGHT BASED ON RECEIPE Element flour baking soda salt butter sugar brown sugar vanilla extract choco chips eggs Expected Totals per Recipe Tray 1 Tray 2 Tray 3 Tray 4 Tray 5 Recipe weight (oz) Price/oz OR unit 10.00 0.04 0.17 0.06 0.17 0.06 8.00 0.19 6.00 0.04 6.00 0.05 0.17 1.95 12.00 0.29 3.00 0.18 45.50 2.86 Recipe 2.25 cup 1 tsp 1 tsp 1 cup 3/4 cup 3/4 cup 1 tsp 2 cups 2 1.1 1.1 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.1 0.9 1.0 1.0 1.0 expected cost 0.40 0.01 0.01 1.52 0.24 0.30 0.33 3.48 0.54 6.83 ACTUAL COOKIE WEIGHT (oz 1.1 1.0 1.0 1.0 1.0 ACTUAL V. BUDGETED COST ANALYSIS Ingredient flour baking soda salt butter Budgeted Amt (oz) Budgeted Cost Budgeted Yield 10.00 0.40 60 0.17 0.01 60 0.17 0.01 60 8.00 1.52 60 Budgeted price per cookie 0.01 0.00 0.00 0.03 sugar brown sugar vanilla extract choco chips eggs TOTALS Variance Output (cookies) Direct Materials flour baking soda salt butter sugar brown sugar vanilla extract choco chips eggs Total Direct Materials Cost/Cookie 6.00 6.00 0.17 12.00 3.00 45.50 $ Actual Yield 47 $0.48 $0.01 $0.01 $1.50 $0.24 $0.25 $0.39 $3.49 $0.37 $6.72 $0.14 0.24 0.30 0.33 3.48 0.54 6.83 60 60 60 60 60 $ Flexible-Budget Favorable or Variance unfavorable $0.17 $0.00 $0.00 $0.30 $0.05 $0.01 $0.13 $0.76 $0.06 $1.37 Spending Variance 0.00 0.01 0.01 0.06 0.01 0.11 100% Flexible Budget 47 U U F U U U U U F U $0.31 $0.01 $0.01 $1.19 $0.19 $0.24 $0.25 $2.73 $0.42 $5.35 $ 0.11 Resulting conclusions: The recipe was supposed to yield 60 cookies but I only yield 47. I believe this was because the recipe nuts which was optional but may contributed to the 60 cookie calculation. Since my recipe had less ingredients it would yie using 1 tablespoon measurements of cookie dough. Another reason for the variation could be the amount of cookie dough p did say 1 rounded tablespoon per cookie and although I tried to make all the cookies weigh about the same before baking, m of 1 rounded tablespoon is too much. The flexible budget variances for most of the ingredients are unfavorable which is attr difference between the flexible budget and the actual yield. This means that I spend more on the ingredients than what was yielded less cookies. The sales volume variances are favorable which makes sense because I made less cookies than the stati I have in theory spent less on direct materials (ingredients). The efficiency variance is 1.48 F due to the lower production, bu is unfavorable. Overall the cost per cookie was actually more than budgeted because I made less cookies than budgeted. Th materials is spread among a lower output level. To improve for next time I'll just have to make smaller cookies to yield mor each egg weighs ~ 1.5oz (1.5x2 = 3oz) * per egg ACTUAL COOKIE WEIGHT (oz BEFORE COOKING) 0.9 1.0 1.2 1.1 0.9 0.9 1.0 1.0 0.8 0.8 1.1 1.0 0.9 1.0 0.8 1.1 1.1 1.0 1.0 0.9 1.0 0.9 0.9 Expected Total Weight Based on Recipe Actual Vs. Recipe Variance ETED COST ANALYSIS Actual Amount (oz) 12.80 0.20 0.10 8.00