Genie in a Bottle Company (GBC) manufactures plastic two-liter bottles for the beverage industry. The cost standards per 100 two-liter bottles are as follows: Cost Category Standard Cost per 100 Two-Liter Bottles Direct labor $1.16 Direct materials 4.82 Factory overhead 0.26 Total $6.24 At the beginning of July, GBC management planned to produce 690,000 bottles. The actual number of bottles produced for July was 745,200 bottles. The actual costs for July of the current year were as follows: Cost Category Actual Cost for the Month Ended July 31 Direct labor $8,471 Direct materials 35,057 Factory overhead 1,957 Total $45,485 Enter all amounts as positive numbers. a. Prepare the July manufacturing standard cost budget (direct labor, direct materials, and factory overhead) for WBC, assuming planned production. Genie in a Bottle Company Manufacturing Cost Budget For the Month Ended July 31 Standard Cost at Planned Volume(690,000 Bottles) Manufacturing costs: Direct labor $fill in the blank 26e62b083002053_1 Direct materials fill in the blank 26e62b083002053_2 Factory overhead fill in the blank 26e62b083002053_3 Total $fill in the blank 26e62b083002053_4 Feedback b. Prepare a budget performance report for manufacturing costs, showing the total cost variances for direct materials, direct labor, and factory overhead for July. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. If required, round your answers to nearest cent. Genie in a Bottle Company Manufacturing Costs-Budget Performance Report For the Month Ended July 31 Actual Costs Standard Cost at Actual Volume(745,200 Bottles) Cost Variance- (Favorable) Unfavorable Manufacturing costs: Direct labor $fill in the blank 9ef963f73058005_1 $fill in the blank 9ef963f73058005_2 $fill in the blank 9ef963f73058005_3 Direct materials fill in the blank 9ef963f73058005_4 fill in the blank 9ef963f73058005_5 fill in the blank 9ef963f73058005_6 Factory overhead fill in the blank 9ef963f73058005_7 fill in the blank 9ef963f73058005_8 fill in the blank 9ef963f73058005_9 Total manufacturing cost $fill in the blank 9ef963f73058005_10 $fill in the blank 9ef963f73058005_11 $fill in the blank 9ef963f73058005_12 Feedback c. The Company's actual costs were $1015.48 than budgeted. direct labor and direct material cost variances more than offset a small factory overhead cost variance.

Cost Category

Standard Cost
per 100 Two-Liter
Bottles

Direct labor

Direct materials

Factory overhead

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Genie in a Bottle Company (GBC) manufactures plastic two-liter bottles for the beverage industry. The cost standards per 100 two-liter bottles are as follows:

At the beginning of July, GBC management planned to produce 690,000 bottles. The actual number of bottles produced for July was 745,200 bottles. The actual costs for July of the current year were as follows:

Cost Category	Actual Cost for the Month Ended July 31
Direct labor		$8,471
Direct materials		35,057
Factory overhead		1,957
	Total		$45,485

Enter all amounts as positive numbers.

a. Prepare the July manufacturing standard cost budget (direct labor, direct materials, and factory overhead) for WBC, assuming planned production.

Genie in a Bottle Company
Manufacturing Cost Budget
For the Month Ended July 31
	Standard Cost at Planned Volume(690,000 Bottles)
Manufacturing costs:
Direct labor	$fill in the blank 26e62b083002053_1
Direct materials	fill in the blank 26e62b083002053_2
Factory overhead	fill in the blank 26e62b083002053_3
Total	$fill in the blank 26e62b083002053_4

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b. Prepare a budget performance report for manufacturing costs, showing the total cost variances for direct materials, direct labor, and factory overhead for July. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. If required, round your answers to nearest cent.

Genie in a Bottle Company
Manufacturing Costs-Budget Performance Report
For the Month Ended July 31
	Actual Costs	Standard Cost at Actual Volume(745,200 Bottles)	Cost Variance- (Favorable) Unfavorable
Manufacturing costs:
Direct labor	$fill in the blank 9ef963f73058005_1	$fill in the blank 9ef963f73058005_2	$fill in the blank 9ef963f73058005_3
Direct materials	fill in the blank 9ef963f73058005_4	fill in the blank 9ef963f73058005_5	fill in the blank 9ef963f73058005_6
Factory overhead	fill in the blank 9ef963f73058005_7	fill in the blank 9ef963f73058005_8	fill in the blank 9ef963f73058005_9
Total manufacturing cost	$fill in the blank 9ef963f73058005_10	$fill in the blank 9ef963f73058005_11	$fill in the blank 9ef963f73058005_12

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c. The Company's actual costs were $1015.48 than budgeted. direct labor and direct material cost variances more than offset a small factory overhead cost variance.

Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.

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