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Answer only 4th

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Answer only 4th
Accounting Simple Jeans is preparing its budget for the next 12 months and uses zero-based budgeting. The budgeted sales price is $44.90 per unit and the budgeted volume of production and sales for the next 12 month period is 100,000 units. The material and labour requirements to produce one pair of jeans are as follows: Direct Materials. Direct Labour Machine hours are used to allocate both variable overheads and fixed overheads. Each pair of jeans uses 0.35 machine hours. The budgeted variable overhead costs are $1,170,000 while the budgeted fixed overhead costs are $356,200 for the year. 2.5 m $6.50 per metre 0.6 DLH $16.75 per labour hour You are later provided with the following detailed actual results and actual costs for the year. Actual $4,249,000 Sales Revenue Direct Materials Direct Labour Variable Overhead Total Variable Costs Contribution Fixed Overhead Costs Net Profit $1,548,450 $953,100 $1,069,375 $3,570,925 $678,075 $358,600 $319,475 90,000 units 225,900 m 56,990 DLH 32,690 MH 1) Calculate the sales volume variance for sales revenue for Simple Jeans. 2) Calculate the sales volume variance for total variable costs for Simple Jeans. 3) Calculate the flexible budget variance for sales revenue for Simple Jeans. 4) Calculate the flexible budget variance for direct materials for Simple Jeans. Give your answer in 2 decimal places and in absolute dollar value (negative not required).
Transcribed Image Text:Accounting Simple Jeans is preparing its budget for the next 12 months and uses zero-based budgeting. The budgeted sales price is $44.90 per unit and the budgeted volume of production and sales for the next 12 month period is 100,000 units. The material and labour requirements to produce one pair of jeans are as follows: Direct Materials. Direct Labour Machine hours are used to allocate both variable overheads and fixed overheads. Each pair of jeans uses 0.35 machine hours. The budgeted variable overhead costs are $1,170,000 while the budgeted fixed overhead costs are $356,200 for the year. 2.5 m $6.50 per metre 0.6 DLH $16.75 per labour hour You are later provided with the following detailed actual results and actual costs for the year. Actual $4,249,000 Sales Revenue Direct Materials Direct Labour Variable Overhead Total Variable Costs Contribution Fixed Overhead Costs Net Profit $1,548,450 $953,100 $1,069,375 $3,570,925 $678,075 $358,600 $319,475 90,000 units 225,900 m 56,990 DLH 32,690 MH 1) Calculate the sales volume variance for sales revenue for Simple Jeans. 2) Calculate the sales volume variance for total variable costs for Simple Jeans. 3) Calculate the flexible budget variance for sales revenue for Simple Jeans. 4) Calculate the flexible budget variance for direct materials for Simple Jeans. Give your answer in 2 decimal places and in absolute dollar value (negative not required).
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