Solution:
Budgeted contribution margin per unit= $135 - ($16 + $16 + $60*0.50) = $73 per unit
Actual sales units = Budgeted sales units - Unfavorable activity variance / Budgeted contribution margin per unit
= 108000 - ($438,000 / $73) = 102000 units
Fixed overhead price variance = Budgeted fixed overhead - Actual fixed overhead
= (108000*$14) - $1,690,000 = $178,000 U
Fixed overhead production volume variance = Fixed overhead applied - Budgeted fixed overhead
= (102000*$14) - (108000*$14) = $84,000 U
Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The company carries...
Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The company carries no inventories. The master budget calls for the company to manufacture and sell 108,000 liters at a budgeted price of $135 per liter this year. The standard direct cost sheet for one liter of the preservative follows. Direct materials Direct labor (2 pounds @ $8) (0.5 hours $32) $16 16 Variable overhead is applied based on direct labor hours. The variable overhead rate is...
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Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The company carries no inventories. The master budget calls for the company to manufacture and sell 116,000 liters at a budgeted price of $195 per liter this year. The standard direct cost sheet for one liter of the preservative follows. Direct materials (2 pounds @ $12) $ 24 Direct labor (0.5 hours @ $40) 20 Variable overhead is applied based on direct labor hours. The variable overhead...
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Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The company carries no inventories. The master budget calls for the company to manufacture and sell 100,000 liters at a budgeted price of $75 per liter this year. The standard direct cost sheet for one liter of the preservative follows. Direct materials Direct labor (2 pounds @ $4) (0.5 hours @ $24) $ 8 12 Variable overhead is applied based on direct labor hours. The variable overhead...
Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The company carries no inventories. The master budget calls for the company to manufacture and sell 100,000 liters at a budgeted price of $75 per liter this vear. The standard direct cost sheet for one liter of the preservative follows. Direct materials Direct labor (2 pounds $4) (0.5 hours $24) $ 8 12 Variable overhead is applied based on direct labor hours. The variable overhead rate is...
Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The company carries no inventories. The master budget calls for the company to manufacture and sell 118,000 liters at a budgeted price of $210 per liter this year. The standard direct cost sheet for one liter of the preservative follows. Direct materials (2 pounds @ $13) $ 26 Direct labor (0.5 hours @ $42) 21 Variable overhead is applied based on direct labor hours. The variable overhead...
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Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The company carries no inventories. The master budget calls for the company to manufacture and sell 122,000 liters at a budgeted price of $240 per liter this year. The standard direct cost sheet for one liter of the preservative follows. Direct materials (2 pounds @ $15) $ 30 Direct labor (0.5 hours @ $46) 23 Variable overhead is applied based on direct labor hours. The variable overhead...
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