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Required: Prepare a profit variance analysis. Note: Enter your answers in thousands of dollars. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option. Sales revenue Materials Direct labor Variable overhead Total variable costs Contribution margin Fixed costs: Manufacturing Non-manufacturing Total fixed costs Operating profits $ $ $ $ $ Actual 17,300 1,598 1,847 990 4,435 12,865 2,475 2,144 4,619 8,246 GOLDEN FOOD PRODUCTS Profit Variance Analysis Non-Manufacturing Variances Manufacturing Variances Sales Price Variance Flexible Budget Sales Activity Variance Master Budget

Required: Prepare a profit variance analysis. Note: Enter your answers in thousands of dollars. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option. Sales revenue Materials Direct labor Variable overhead Total variable costs Contribution margin Fixed costs: Manufacturing Non-manufacturing Total fixed costs Operating profits $ $ $ $ $ Actual 17,300 1,598 1,847 990 4,435 12,865 2,475 2,144 4,619 8,246 GOLDEN FOOD PRODUCTS Profit Variance Analysis Non-Manufacturing Variances Manufacturing Variances Sales Price Variance Flexible Budget Sales Activity Variance Master Budget

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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5 Golden Food Products produces special-formula pet food. The company carries no inventories. The master budget calls for the company to manufacture and sell 234,000 cases at a budgeted price of $60 per case this year. The standard direct cost sheet for one case of pet food follows: eBook F Print References Direct materials Direct labor Sales revenue Less variable costs. Variable overhead is applied based on direct labor-hours. The variable overhead rate is $16 per direct labor-hour. The fixed overhead rate (at the master budget level of activity) is $10 per unit. All nonmanufacturing costs are fixed and are budgeted at $2.2 million for the coming year. At the end of the year, the costs analyst reported that the sales activity variance for the year was $336,000 favorable. The following is the actual income statement (in thousands of dollars) for the year for Golden Food Products: Direct materials. Direct labor Variable overhead Total variable costs (3 pounds @ $2) (0.25 hours @ $32) Contribution margin Less fixed costs Fixed manufacturing overhead Nonmanufacturing costs Total fixed costs Operating profit $ 17,300 1,598 21 1,847 990 $4,435 $ 12,865 2,475 2,144 $4,619 $6 8 $ 8,246
Transcribed Image Text:5 Golden Food Products produces special-formula pet food. The company carries no inventories. The master budget calls for the company to manufacture and sell 234,000 cases at a budgeted price of $60 per case this year. The standard direct cost sheet for one case of pet food follows: eBook F Print References Direct materials Direct labor Sales revenue Less variable costs. Variable overhead is applied based on direct labor-hours. The variable overhead rate is $16 per direct labor-hour. The fixed overhead rate (at the master budget level of activity) is $10 per unit. All nonmanufacturing costs are fixed and are budgeted at $2.2 million for the coming year. At the end of the year, the costs analyst reported that the sales activity variance for the year was $336,000 favorable. The following is the actual income statement (in thousands of dollars) for the year for Golden Food Products: Direct materials. Direct labor Variable overhead Total variable costs (3 pounds @ $2) (0.25 hours @ $32) Contribution margin Less fixed costs Fixed manufacturing overhead Nonmanufacturing costs Total fixed costs Operating profit $ 17,300 1,598 21 1,847 990 $4,435 $ 12,865 2,475 2,144 $4,619 $6 8 $ 8,246
Required: Prepare a profit variance analysis. Note: Enter your answers in thousands of dollars. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option. Sales revenue Materials Direct labor Variable overhead Total variable costs Contribution margin Fixed costs: Manufacturing Non-manufacturing Total fixed costs Operating profits $ 17,300 1,598 1.847 990 4,435 12,865 $ $ Actual $ 2.475 2,144 4,619 8,246 GOLDEN FOOD PRODUCTS Profit Variance Analysis Non-Manufacturing Variances Manufacturing Variances Sales Price Variance Flexible Budget Sales Activity Variance Master Budget
Transcribed Image Text:Required: Prepare a profit variance analysis. Note: Enter your answers in thousands of dollars. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option. Sales revenue Materials Direct labor Variable overhead Total variable costs Contribution margin Fixed costs: Manufacturing Non-manufacturing Total fixed costs Operating profits $ 17,300 1,598 1.847 990 4,435 12,865 $ $ Actual $ 2.475 2,144 4,619 8,246 GOLDEN FOOD PRODUCTS Profit Variance Analysis Non-Manufacturing Variances Manufacturing Variances Sales Price Variance Flexible Budget Sales Activity Variance Master Budget
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