Naiya Amin
ACCT 3231*01WC
Assignment # 11
Problem 719:
1.
Flexible – Budget Variance is $15,000 Unfavorable
Sales – Volume Variance is $15,000 Favorable
2.
Actual selling price: $715,000 a 130,000 = $5.50
Budgeted selling price: 420,000 ÷ 120,000 = $3.50
Actual variable cost per unit: 515,000 ÷ 130,000 = $3.96
Budgeted variable cost per unit: 240,000 ÷ 120,000 = $2.00
Problem 720:
1.
Compute flexible budget Variance
Actual Budgeting
Static Budgeting
Output Units (Scones)
60,800
60,000
Input units (Pounds of Pumpkin)
16,000
15,000
Cost per input unit
$0.82
$0.89
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Compute the flexible price and efficiency variances
Price Variance is $1,120 (14,240 – 13,120) Favorable
Efficiency Variance is $712 (13,528 – 14,240) Unfavorable
3.
Comments : The favorable flexiblebudget variance of $408 has two offsetting components:
(a) Favorable price variance of $1,120––reflects the $0.82 actual purchase cost being lower than the $0.89
budgeted purchase cost per pound.
(b) Unfavorable efficiency variance of $712––reflects the actual materials yield of 3.80 scones per pound of
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 Spring '09
 WAILOO
 Cost Accounting, Addition, Variance, Elementary arithmetic

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