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Whiplash Ltd. makes a single product and only one type of direct material is used to make this product. Whiplash uses a standard costing system
Whiplash Ltd. makes a single product and only one type of direct material is used to make this product. Whiplash uses a standard costing system and has provided the following data concerning the production of output in July: Actual number of units of output produced 7,800 units Materials quantity variance $2,609 Favorable (F) Materials spending variance $3,744 Favorable (F) Standard amount of materials used per unit of output 5.0 grams per unit Actual total materials purchased/used 37,830 grams Actual price per gram purchased/used $2.20 per gram Assume there were no beginning or ending inventories of direct materials. The standard price per gram for Whiplash, Ltd. is closest to: a $2.27 per gram b- $2.30 per gram C. $2.23 per gram od $2.07 per gram e $2.04 per gram Fresh as a Daisy, Inc. manufactures flower pots. It can produce and sell plain, unpainted pots for $11 each and the manufacturing costs incurred for the plain, unpainted pots are as follows: Variable manufacturing costs per pot: $4.50 Fixed manufacturing cost per pot: $1.50 Variable Selling and admin costs per pot: $0.25 Fixed Selling and admin costs per pot: $0.75 Fresh as a Daisy can also process these pots further by painting them with special designs for customers. It could sell these painted pots for $17 each. The additional variable manufacturing costs of painting and finishing the pots would be $4 per pot, and there would be no additional fixed manufacturing costs nor any additional selling and administrative costs. What is the financial advantage (disadvantage) per unit for the company if it processes the flower pots further by painting them? 0 a $10 ob. (SA) 0 C.$13 od $6 e. $2 0
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