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+ themereititi wi pastiect 506 Chapter 11 Flexible Bucgeting and Analysis of overhead Costs Case 1155 Comprehensive Variance Aunt Molly's Old Fashioned Cookies bakes cookies for retail stores. The company's best-selling cookie Araysis Used to Explain is chocolate nut supreme, which is marketed as a gourmet cookie and regularly sells for $8.00 per pound. Operational Results, Review The standard cost per pound of chocolate nut supreme, based on Aunt Molly's normal monthly producof Chapters 10 and 11; tion of 400,000 pounds, is as follows: Activity-Based Cosing; Sales Varlances (Appendix B) (L0 11-4, 11.5, 11-7, 11-9) Alat Direct-matertal pitce. varance, totat 553,000 U 4 (o) Vurable-oretead spendeag varrance 5$5,000U 4ist Salespoce vartance Stiponu Aunt Molly's management accountant, Karen Blair, prepares monthly budget reports based on these standard costs. April's contribution report, which compares budgeted and actual performance, is shown in the following schedule. Aunt Molly's management accountant. Karen Blair. prepares monthly budget reports bused on these standard costs. April's contribution report, which compares budgeted and actual performance, is shown in the following schodule. 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 contribetion margin docreaved. Blair has gathered the following information to help in her analysis of the decrease. 3. Explain (i.e, interpret) the meaning of the total contribution margin in the Hexible budget column of the new teport prepared for requirement (1). 4. What is the tolal varianee between the flexible budget contribution margin and the actual contribution margin in the new repot prepared for requirement (1)? Exptain this total contribution margin variance toy convuting the following variances. (Assume that all materiats ure used in the month of purchased a Duect-material price variance. b. Direct-material quantity variance. c. Direct-lahor rate variance. a. Direct-labor elficiency variance. e Variable-ovetheal spending variance. f. Variable-overtiead efliciency variance. E. Sales price variance. 5. a Explain the problems that mights arine is wing direct-labor hour as the favis for applying uverivend. b. How might activity hosed couint (ABC) wotve the problems described in requirement (Sa)t 506 Chapter 11 Flexible Bucgeting and Analysis of overhead Costs Case 1155 Comprehensive Variance Aunt Molly's Old Fashioned Cookies bakes cookies for retail stores. The company's best-selling cookie Araysis Used to Explain is chocolate nut supreme, which is marketed as a gourmet cookie and regularly sells for $8.00 per pound. Operational Results, Review The standard cost per pound of chocolate nut supreme, based on Aunt Molly's normal monthly producof Chapters 10 and 11; tion of 400,000 pounds, is as follows: Activity-Based Cosing; Sales Varlances (Appendix B) (L0 11-4, 11.5, 11-7, 11-9) Alat Direct-matertal pitce. varance, totat 553,000 U 4 (o) Vurable-oretead spendeag varrance 5$5,000U 4ist Salespoce vartance Stiponu Aunt Molly's management accountant, Karen Blair, prepares monthly budget reports based on these standard costs. April's contribution report, which compares budgeted and actual performance, is shown in the following schedule. Aunt Molly's management accountant. Karen Blair. prepares monthly budget reports bused on these standard costs. April's contribution report, which compares budgeted and actual performance, is shown in the following schodule. 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 contribetion margin docreaved. Blair has gathered the following information to help in her analysis of the decrease. 3. Explain (i.e, interpret) the meaning of the total contribution margin in the Hexible budget column of the new teport prepared for requirement (1). 4. What is the tolal varianee between the flexible budget contribution margin and the actual contribution margin in the new repot prepared for requirement (1)? Exptain this total contribution margin variance toy convuting the following variances. (Assume that all materiats ure used in the month of purchased a Duect-material price variance. b. Direct-material quantity variance. c. Direct-lahor rate variance. a. Direct-labor elficiency variance. e Variable-ovetheal spending variance. f. Variable-overtiead efliciency variance. E. Sales price variance. 5. a Explain the problems that mights arine is wing direct-labor hour as the favis for applying uverivend. b. How might activity hosed couint (ABC) wotve the problems described in requirement (Sa)t + themereititi wi pastiect 506 Chapter 11 Flexible Bucgeting and Analysis of overhead Costs Case 1155 Comprehensive Variance Aunt Molly's Old Fashioned Cookies bakes cookies for retail stores. The company's best-selling cookie Araysis Used to Explain is chocolate nut supreme, which is marketed as a gourmet cookie and regularly sells for $8.00 per pound. Operational Results, Review The standard cost per pound of chocolate nut supreme, based on Aunt Molly's normal monthly producof Chapters 10 and 11; tion of 400,000 pounds, is as follows: Activity-Based Cosing; Sales Varlances (Appendix B) (L0 11-4, 11.5, 11-7, 11-9) Alat Direct-matertal pitce. varance, totat 553,000 U 4 (o) Vurable-oretead spendeag varrance 5$5,000U 4ist Salespoce vartance Stiponu Aunt Molly's management accountant, Karen Blair, prepares monthly budget reports based on these standard costs. April's contribution report, which compares budgeted and actual performance, is shown in the following schedule. Aunt Molly's management accountant. Karen Blair. prepares monthly budget reports bused on these standard costs. April's contribution report, which compares budgeted and actual performance, is shown in the following schodule. 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 contribetion margin docreaved. Blair has gathered the following information to help in her analysis of the decrease. 3. Explain (i.e, interpret) the meaning of the total contribution margin in the Hexible budget column of the new teport prepared for requirement (1). 4. What is the tolal varianee between the flexible budget contribution margin and the actual contribution margin in the new repot prepared for requirement (1)? Exptain this total contribution margin variance toy convuting the following variances. (Assume that all materiats ure used in the month of purchased a Duect-material price variance. b. Direct-material quantity variance. c. Direct-lahor rate variance. a. Direct-labor elficiency variance. e Variable-ovetheal spending variance. f. Variable-overtiead efliciency variance. E. Sales price variance. 5. a Explain the problems that mights arine is wing direct-labor hour as the favis for applying uverivend. b. How might activity hosed couint (ABC) wotve the problems described in requirement (Sa)t 506 Chapter 11 Flexible Bucgeting and Analysis of overhead Costs Case 1155 Comprehensive Variance Aunt Molly's Old Fashioned Cookies bakes cookies for retail stores. The company's best-selling cookie Araysis Used to Explain is chocolate nut supreme, which is marketed as a gourmet cookie and regularly sells for $8.00 per pound. Operational Results, Review The standard cost per pound of chocolate nut supreme, based on Aunt Molly's normal monthly producof Chapters 10 and 11; tion of 400,000 pounds, is as follows: Activity-Based Cosing; Sales Varlances (Appendix B) (L0 11-4, 11.5, 11-7, 11-9) Alat Direct-matertal pitce. varance, totat 553,000 U 4 (o) Vurable-oretead spendeag varrance 5$5,000U 4ist Salespoce vartance Stiponu Aunt Molly's management accountant, Karen Blair, prepares monthly budget reports based on these standard costs. April's contribution report, which compares budgeted and actual performance, is shown in the following schedule. Aunt Molly's management accountant. Karen Blair. prepares monthly budget reports bused on these standard costs. April's contribution report, which compares budgeted and actual performance, is shown in the following schodule. 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 contribetion margin docreaved. Blair has gathered the following information to help in her analysis of the decrease. 3. Explain (i.e, interpret) the meaning of the total contribution margin in the Hexible budget column of the new teport prepared for requirement (1). 4. What is the tolal varianee between the flexible budget contribution margin and the actual contribution margin in the new repot prepared for requirement (1)? Exptain this total contribution margin variance toy convuting the following variances. (Assume that all materiats ure used in the month of purchased a Duect-material price variance. b. Direct-material quantity variance. c. Direct-lahor rate variance. a. Direct-labor elficiency variance. e Variable-ovetheal spending variance. f. Variable-overtiead efliciency variance. E. Sales price variance. 5. a Explain the problems that mights arine is wing direct-labor hour as the favis for applying uverivend. b. How might activity hosed couint (ABC) wotve the problems described in requirement (Sa)t
