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Flexible Budgeting and Variance Analysis I Love My Chocolate Company makes dark chocolate and light chocolate. Both products require cocoa and sugar. The following planning information has been made available: Standard Amount per Case Light Chocolate 7 lbs. Cocoa Sugar Standard labor time Dark Chocolate 10 lbs. 8 lbs. Planned production Standard labor rate 0.4 hr. 12 lbs. 0.5 hr. Standard Price per Pound $4.20 0.60 Dark Chocolate Light Chocolate 5,500 cases 10,900 cases $15.00 per hr. $15.00 per hr. I Love My Chocolate Company does not expect there to be any beginning or ending inventories of cocoa or sugar. At the end of the budget year, I Love My Chocolate Company

Flexible Budgeting and Variance Analysis I Love My Chocolate Company makes dark chocolate and light chocolate. Both products require cocoa and sugar. The following planning information has been made available: Standard Amount per Case Light Chocolate 7 lbs. Cocoa Sugar Standard labor time Dark Chocolate 10 lbs. 8 lbs. Planned production Standard labor rate 0.4 hr. 12 lbs. 0.5 hr. Standard Price per Pound $4.20 0.60 Dark Chocolate Light Chocolate 5,500 cases 10,900 cases $15.00 per hr. $15.00 per hr. I Love My Chocolate Company does not expect there to be any beginning or ending inventories of cocoa or sugar. At the end of the budget year, I Love My Chocolate Company

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Flexible Budgeting and Variance Analysis I Love My Chocolate Company makes dark chocolate and light chocolate. Both products require cocoa and sugar. The following planning information has been made available: Standard Amount per Case Light Chocolate Cocoa Sugar Standard labor time Planned production Standard labor rate Actual production (cases) Dark Chocolate 10 lbs. 8 lbs. Cocoa 0.4 hr. 5,200 7 lbs. 12 lbs. Dark Chocolate Light Chocolate 5,500 cases 10,900 cases $15.00 per hr. $15.00 per hr. I Love My Chocolate Company does not expect there to be any beginning or ending inventories of cocoa or sugar. At the end of the budget year, I Love My Chocolate Company had the following actual results: Dark Chocolate Pound 0.5 hr. Actual Price per $4.30 Standard Price per Pound $4.20 0.60 11,300 Light Chocolate Actual Pounds Purchased and Used 131,800
Transcribed Image Text:Flexible Budgeting and Variance Analysis I Love My Chocolate Company makes dark chocolate and light chocolate. Both products require cocoa and sugar. The following planning information has been made available: Standard Amount per Case Light Chocolate Cocoa Sugar Standard labor time Planned production Standard labor rate Actual production (cases) Dark Chocolate 10 lbs. 8 lbs. Cocoa 0.4 hr. 5,200 7 lbs. 12 lbs. Dark Chocolate Light Chocolate 5,500 cases 10,900 cases $15.00 per hr. $15.00 per hr. I Love My Chocolate Company does not expect there to be any beginning or ending inventories of cocoa or sugar. At the end of the budget year, I Love My Chocolate Company had the following actual results: Dark Chocolate Pound 0.5 hr. Actual Price per $4.30 Standard Price per Pound $4.20 0.60 11,300 Light Chocolate Actual Pounds Purchased and Used 131,800
Cocoa Sugar Actual Price per b. Pound $4.30 0.55 Actual Labor Rate $14.60 per hr. 15.40 per hr. Dark chocolate Light chocolate Required: 1. Prepare the following variance analyses for both chocolates and the total, based on the actual results and production levels at the end of the budget year: a. Direct materials price variance, direct materials quantity variance, and total variance. b. Direct labor rate variance, direct labor time variance, and total variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. If there is no variance, enter a zero. a. Direct materials price variance Direct materials quantity variance Total direct materials cost variance Direct labor rate variance Direct labor time variance Actual Pounds Purchased and Used Total direct labor cost variance 131,800 172,800 Actual Labor Hours Used 000 $ 1,890 5,790
Transcribed Image Text:Cocoa Sugar Actual Price per b. Pound $4.30 0.55 Actual Labor Rate $14.60 per hr. 15.40 per hr. Dark chocolate Light chocolate Required: 1. Prepare the following variance analyses for both chocolates and the total, based on the actual results and production levels at the end of the budget year: a. Direct materials price variance, direct materials quantity variance, and total variance. b. Direct labor rate variance, direct labor time variance, and total variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. If there is no variance, enter a zero. a. Direct materials price variance Direct materials quantity variance Total direct materials cost variance Direct labor rate variance Direct labor time variance Actual Pounds Purchased and Used Total direct labor cost variance 131,800 172,800 Actual Labor Hours Used 000 $ 1,890 5,790
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