Compute for the following:Total gross profit variance =Price variance = Price-Quantity variance = Cost variance = Cost-Quantity variance = Format: 11,111 F or 11,111 U The income statement of GMA Company for the yearsendedDecember 31, 2020 and 2021 showed the following data.20202021Net Sales800,000924,000Cost of Sales480,000501,600Gross Margin320,000422,400Operating expenses180,000140,000220,000202,400Net incomeAdditional Data:Units sold80,00088,000Unit selling price10.0010.50Unit cost6.005.70

Name: Compute for the following:Total gross profit variance =Price variance
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Description: Compute for the following:Total gross profit variance =Price variance = Price-Quantity variance = Cost variance = Cost-Quantity variance = Format: 11,111 F or 11,111 U The income statement of GMA Company for the yearsendedDecember 31, 2020 and 2021 s

Variance is the deviation between actual figures and budgeted figures. If the deviation or change is…

Answered: Total gross profit variance = Price…

Business

Accounting

Total gross profit variance = Price variance = Price-Quantity variance = Cost variance = Cost-Quantity variance =

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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Concept explainers

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.

Topic Video

Question

Compute for the following:

Total gross profit variance =
Price variance =
Price-Quantity variance =
Cost variance =
Cost-Quantity variance =

Format: 11,111 F or 11,111 U

The income statement of GMA Company for the years
ended
December 31, 2020 and 2021 showed the following data.
2020
2021
Net Sales
800,000
924,000
Cost of Sales
480,000
501,600
Gross Margin
320,000
422,400
Operating expenses
180,000
140,000
220,000
202,400
Net income
Additional Data:
Units sold
80,000
88,000
Unit selling price
10.00
10.50
Unit cost
6.00
5.70

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Trini Company set the following standard costs per unit for its single product Direct materials (30 pounds @ $4.40 per pound) Direct labor (6 hours @ $14 per hour) Variable overhead (6 hours @ $8 per hour) Fixed overhead (6 hours @ $11 per hour) $ 132.00 84.00 48.00 66.00 $ 330.00 Standard cost per unit Overhead is applied using direct labor hours. The standard overhead rate is based on a predicted activity level of 80% of the company's capacity of 50,000 units per quarter. The following additional information is available. Production (in units) Standard direct labor hours (6 DLH per unit) Budgeted overhead (flexible budget) Fixed overhead Variable overhead Operating Levels 70% 80% 90% 35,000 210,000 40,000 240,000 45,000 270,000 $ 2,640,000 $ 1,680,000 $ 2,640,000 $ 2,640,000 $ 1,920,000 $ 2,160,000 During the current quarter, the company operated at 90% of capacity and produced 45,000 units; actual direct labor totaled 266,000 hours. Units produced were assigned the following…
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