Blossom Construction's manufacturing costs for August when production was 1,120 units are as follows: Direct material Direct labor Variable overhead Factory depreciation Factory supervisory salaries Other fixed factory costs $13 per unit $8,400 7,280 10,200 9,000 3,700 Compute the flexible budget manufacturing cost amount for a month in which 1,020 units are produced. Flexible Budget Manufacturing Cost $ 49275
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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