ww now wwpoam Factory Overhead Controllable Variance Actual variable overhead Variable overhead at standard cost Factory overhead controllable varianoe Points: 3/0 utilities The factory overhead controllable variance was caused to variance. 1/1 Points four 13. Datemine and interprat the factary overhead volumo variance. Nogative amount should be indicated by the minus aign. Entar a favorable variance aa a nogative number uaing a minus aign and an unfavorablo variance as a poaitive number. Round rate : decimal places and round your final answer to two decimal places Factory Overhead Volume Variance Normal volume (cases) Actual volume (cases) Differange Fixed factory overhead rate Factory overhead volume variance Points: 2/7 The volume variance indicates the cost of underused capacity Points 1/1 Feadhack the actual 1,500-case production volume rather than the planned 1,250 cases of production used in the budgets for parts (6) and (7)? 14. Why are the standard direct labor and direct materials costs in the calculations for parts (10) and (11) based The production volume of cases was planned at the beginning of August. The variances compare the actual cost and the standard cost of actual production for the month. Thus, the standard cost must be based on the units of actual production. Points: 1/3 11. Detemine and interpret the direct labor rate and time variances for the two departments. Negative amount should be indicated by the minus sign. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. Do not round houre Round your anawera to two decimal places Direct Labor Rate Variance Mixing Department Filling Department $18.20 V Actual rate Standard rate 18.00 v S0,20 Differance Actual time V 488.0 x $97.60 x Direct labor rate variance Points: 8/16 Direct Labor Time Variance Filling Department Mixing Department 140.0V Actual time 488.0 x 150.0x 500.0V Standard time 12.0 X 10.0 x Difference $18,00 v $14.40 Standard rate U V $216.00 x $144.00 x Direct labor time varianoe Points: 9/15 10. Defemine and interpret the direct materials price and quantity variances for the three materials. Negative amounf should be indicated by the minus sign. Enfer a favorable variance as a negative number using a minus sign and an unfavarable variance as a positive number. Round your price values for Cream Base three decimal places and Natural Oils & Bottles to two decimal places. Direct Materials Price Variance Cream Base Natural Oils Bottles $15.000 x Actual price v 18.000 x Standard price Difference Actual quantity ozs. ozs. FY U Direct materials price variance Points: 7/24 Direct Materials Quantity Variance Natural Oils Cream Base Bottles ozs. Actual quantity Standard quantity Difference ozs, $18.00 x Standard price Direct materials quantity variance L Points: 6/27 Genuine Spice Inc began operations on January 1 of the current year. The company produces 8-ounce bottles of hand and body lotion called Eternal Beauty. The lotion is sold wholesale in 12-bottle cases for $100 per case. There is a selling commission of $20 per case. The January direct materia ls, direct labor, and factory overhead costs are as follows DIRECT MATERIALS Cost Behavior Units per Case Cost per Unit Cost per Case 100 azs so.02 Cream base Variable $ 2.00 0.30 9.00 Natural oile Variable 30 ozs Bottle (8-oz.) Variable 12 bottles 0.50 0 00 $17.00 DIRECT LABOR Labor Rate per Hour Cost per Case Department Cost Behavior Time per Case 0 min $18.00 se.00 Mixing Variable 14 40 1.20 Filling Variable 5 5 min. $7.20 DIRECT LABOR Department Cost Behavior Time per Case Labor Rate per Hour Cost per Case 20 min Mixing Variable S18.00 S8.00 Filling Variable 14.40 1.20 25 min. S7.20 FACTORY OVERHEAD Cost Behavior Total Cost Utilities Mixed s800 Facility lease Fixed 14,000 Equipment depreciation Fixed 4,300 Supplies Fixed 680 S19,500 Part C-August Variance Analysis During September of the ourrent year, the controller was asked perform variance analyses for August. The January operating data provided the standsard prices, rates, times, and quantities per case. There were 1,500 actual cases produced during August, which was 250 more cases than planned at t e beginning of the month. Actual data for August ware as follows Actual Direct Materials Quantity per Case Price per Unit S0.010 per oz. 102 ozs Cream base so.32 per oz, Natural oils 31 ozs Bottle (8-oz) S0.42 per bottle 12.5 bottles Labor abor Rate Tin Mixing $18.20 19.50 min Filling 14.00 5.80 min. Actual variable overhead $305.00 1.000 cases Normal volume The prices of the materisls were different than standard due to fluctuations in market prices. The standard quantity of materia ls used per case was an ideal standard. The Mixing Department used a higher grade labor dassification during the month, thus causing the exceed standard. The Filling Department used a lower grade labor classification during the month, thus causing e actual labor rate to be less than standard actual labor rate Finished Goods Inventory Cases Cost Estimated finished goods inventory, August 300 $12.000 Desired finished goods inventory, August 31 75 7,000 Materials Inventory Cream Base Oils Bottles (ozs. (ozs.) (bottles) 250 290 000 Estimated materials inventory. August 1 Desired materials inventory, August 31 1.000 360 240 There was negligible work in process inventory assumed for either the beginning or end of the month; thus, none was assumed. In addition, there was no change in the cost per unit or estimated units per case operating data from January. Required-Part B: 5. Prepare the August production budget. 6. Prepare the August direct materials purchases budget 7. Prepare the August direct labor cost budget. Round the hours required for production to the nearest hour 8. Prepare the August factory overhead cost budget. If an amount box does not require an entry, leave it blank (Entries of zero (0 CNOW.) will be cleared automatioally 9. Prepare the August budgeted income statement, including selling expenses. Enter all amounts as posaitive numbera 9. Prepare the August budgeted income statement, including selling expenses. Enter all amounts as positive numbers. Genuine Spice Inc. Budgeted Income Statement For the Month Ended August 31 $150,000 Sales $12,000 Finished goods inventory, August 1 Direct materials inventory, August 1 $392 Direct materials purchases 23,231 Direct materials inventory, August 31 248 Cost of direct materials for production $23,375 9,900 Direct labor 19,735 53,010 Factory overhead Finished goods inventory, August 31 7,000 58,010 Cost of goods sold $79,490 X Gross profit 27,500 X Selling expenses $51,990 X Income before income tax