Answered: Neighborhood Farming LLC. manufactures…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter18: Pricing And Profitability Analysis

Section: Chapter Questions

Problem 9CE: Budgeted unit sales for the entire countertop oven industry were 2,500,000 (of all model types), and...

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Related questions

Question

Neighborhood Farming LLC. manufactures frozen vegetables and provided the following information related to their direct labor costs:

Direct Labor Costs

DL Cost	Rate	Hour
Standard	$15.60	0.80
Actual	$17.00	0.60

Actual production was 6,000 units of packaged vegetables while the planned production was 5,000 units.

Determine the direct labor flexible budget cost variance.

Group of answer choices

$13,680 unfavorable

-$13,680 favorable

$18,720 unfavorable

-$18,720 favorable

Definition Definition Measure used to estimate the difference between the budgeted and annual proportion for a specific accounting year. A favorable budget variance refers to positive variances or gains, while unfavorable or negative variances refer to a shortfall in the budget. A budget variance is indicative of the instances where the actual costs incurred are higher or lower than the estimated costs.

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