VOH eff. Var/ $1,368 U

Please use the actual numbers of recliners sold by calculating a flexible budget with the information outlined.

Morton Recliners manufacturers leather recliners and uses flexible budgeting and a standard cost system. Morton allocates overhead based on yards of direct materials. The company's performance report includes the following selected data:

		Static Budget - (1,000 Recliners)	Actuual Results (980 Recliners)
Sales	(1,000 Recliners x $505 each)	$505,000
	(980 Recliners x 480 each)		470,400
Variable Manufaturing Costs:
Direct Materials	(6,000 yds @$8.60/yd.)	51,600
	(6,143 yds @ 8.40/yd.)		51,601
Direct Labor	(10,000 DLHr @ $9.20/DLHr)	92,000
	(9,600 DLHr @ 9.30/DLHr)		89,280
Varaible Overhead	(6,000 yds @ $5.20/yd)	31,200
	(6,143 yds @ 6.60/yd)		40,544
Fixed Manufacturing Costs:
Fixed Overhead		60,000	62,600
Total Cost of Goods Sold		235,400	244,025
Gross Profit		$269,600	$226,375