Brier Company, manufacturer of car seat covers, provided the following standard costs for its product: Standard Standard Cost Standard Cost Inputs Quantity ($) per Unit ($) Direct materials 7.1 pounds 5 per pound 35.50 Direct labour 0.8 hours 17 per hour 13.60 Variable overheads 0.8 hours 7 per hour 5.60 The company reported the following in 2022 May: Original budgeted output 4 700 units Actual output 4 500 units Actual direct labour hours 3 610 hours Actual cost of direct labour $65 341 Purchases of raw materials 36 500 pounds Actual price paid for raw materials $186 150 Raw materials used 34 150 pounds Actual variable overhead cost $24 909 Variable overhead is applied on the basis of direct labour hours. A. Compute the following: i. Direct materials quantity variance ii. Direct materials price variance iii. Direct materials total variance
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Brier Company, manufacturer of car seat covers, provided the following
its product:
Standard Standard Cost Standard Cost
Inputs Quantity ($) per Unit ($)
Direct materials 7.1 pounds 5 per pound 35.50
Direct labour 0.8 hours 17 per hour 13.60
Variable
The company reported the following in 2022 May:
Original budgeted output 4 700 units
Actual output 4 500 units
Actual direct labour hours 3 610 hours
Actual cost of direct labour $65 341
Purchases of raw materials 36 500 pounds
Actual price paid for raw materials $186 150
Raw materials used 34 150 pounds
Actual variable overhead cost $24 909
Variable overhead is applied on the basis of direct labour hours.
A. Compute the following:
i. Direct materials quantity variance
ii. Direct materials price variance
iii. Direct materials total variance
iv. Direct labour efficiency variance
v. Direct labour rate variance
vi. Direct labour total variance
vii. Variable overhead efficiency variance
viii. Variable overhead rate variance
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