Problem Set 6 - 1b FlexibleBudget Variances(2)=(1(3 Actual...

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1 bFlexible- Sales-ActualBudgetFlexibleVolumeStaticResultsVariances BudgetVarianceBudget(1)(2)=(1)-(3)(3)(4)=(3)-(5)(5)Units soldRevenuesVariable costs:DM-FramesDM-LenesesDirect mfg. laborTotal variable costsFixed mfg. costsTotal costsGross marginFlexible-budget VarianceSales-volume varianceStatic-budget Variance1 cActual CostsIncurred(Actual #Actual #Budgeted #x Actual Price)x Budgeted Pricex Budgeted PriceDirect materials FramesPrice VarianceEfficiency varianceDirect materials LensesDirect Mfg. LaborPrice VarianceEfficiency variance
Price and efficiency variances(7-24)The Monroe Corporation manufactures lamps. It has set up the followingstandards per finished unit for direct materials and direct manufacturing labor:Direct materials: 10 lb. at $4.50 per lb.$45.00 Direct manufacturturing labor: .5 hours at $30 per hour$15.00 The number of inished units budgeted for January 2012 was 10,000; 9,850 unitswere actually produced.Actual results in January 2012 were as follows:Direct materials: 98,055 lb. usedDirect manufacturing labor: 4,900 hours$154,350 Assume that there was no beginning inventory of either direct materials or finished goods.During the month, materials purchased amounted to 100,000 lb., at a cost of $465,000. Input price variances are isolated upon purchase. Input-efficiencyvariances are isolated at the time of useage.1. Compute the January 2012 price and efficiency variances of direct materialsand direct manufacturing labor.2. Comment on these variances.
Actual QtyActual QtyActual QtyStd. Qtyx Actual Pricex Std. Pricex Std. Pricex Std. PriceDirect100,000 100,000 98,055 98,500 Materials$4.65 $4.50 $4.50 $4.50 $465,000 $450,000 $441,248 $443,250 $15,000 U$(2,003)FPrice varianceEfficency (qty) varianceDirect mfg4,900 4,900 4,925 labor$31.50 $30 $30 $154,350 $147,000 $147,750 $7,350 U$(750)FRate VarianceEfficiency (time) Variance$6,600 UTotal mfg. labor variance

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