Perez Fruit Drink Company planned to make 201,000 containers of apple juice. It expected to use two cups of frozen apple concentrate to make each container of juice, thus using 402,000 cups of frozen concentrate. The standard price of one cup of apple concentrate is $0.23. Perez actually paid $114,817 to purchase 410,060 cups of concentrate, which was used to make 202,000 containers of apple juice. Required: b. Compute the actual price per cup of concentrate. (Round your answer to 2 decimal places.) c. Compute the standard quantity (number of cups of concentrate) required to produce the containers. d. Compute the materials price variance and indicate whether it is favorable (F) or unfavorable (U). (Select "None" if there is no effect (i.e., zero variance). Round "Price variance" to 2 decimal places.) e. Compute the materials usage variance and indicate whether it is favorable (F) or unfavorable (U). (Select "None" if there is no effect (i.e., zero variance). Round "Usage variance" to 2 decimal places.) b. Actual price Standard quantity Total price variance C. d. e. Total usage variance per cup cups

Perez Fruit Drink Company planned to make 201,000 containers of apple juice. It expected to use two cups of frozen apple concentrate to make each container of juice, thus using 402,000 cups of frozen concentrate. The standard price of one cup of apple concentrate is $0.23. Perez actually paid $114,817 to purchase 410,060 cups of concentrate, which was used to make 202,000 containers of apple juice. Required: b. Compute the actual price per cup of concentrate. (Round your answer to 2 decimal places.) c. Compute the standard quantity (number of cups of concentrate) required to produce the containers. d. Compute the materials price variance and indicate whether it is favorable (F) or unfavorable (U). (Select "None" if there is no effect (i.e., zero variance). Round "Price variance" to 2 decimal places.) e. Compute the materials usage variance and indicate whether it is favorable (F) or unfavorable (U). (Select "None" if there is no effect (i.e., zero variance). Round "Usage variance" to 2 decimal places.) b. Actual price Standard quantity Total price variance C. d. e. Total usage variance per cup cups

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 10E: Schylar Pharmaceuticals, Inc., plans to sell 130,000 units of antibiotic at an average price of 22...

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Gibson Fruit Drink Company planned to make 203,000 containers of apple juice. It expected to use two cups of frozen apple concentrate to make each container of juice, thus using 406,000 cups of frozen concentrate. The standard price of one cup of apple concentrate is $0.24. Gibson actually paid $115,954 to purchase 414,120 cups of concentrate, which was used to make 204,000 containers of apple juice. Required: b. Compute the actual price per cup of concentrate. Note: Round your answer to 2 decimal places. c. Compute the standard quantity (number of cups of concentrate) required to produce the containers. d. Compute the materials price variance and indicate whether it is favorable (F) or unfavorable (U). Note: Select "None" if there is no effect (i.e., zero variance). Round "Price variance" to 2 decimal places. e. Compute the materials usage variance and indicate whether it is favorable (F) or unfavorable (U). Note: Select "None" if there is no effect (i.e., zero variance). Round "Usage…
Wilkin Fruit Drink Company planned to make 400,000 containers of apple juice. It expected to use two cups of frozen apple concentrate to make each container of juice, thus using 800,000 cups (400,000 containers x 2 cups) of frozen concentrate. The standard price of one cup of apple concentrate is $0.25. Actually, Wilkin produced 404,000 containers of apple juice and purchased and used 820,000 cups of concentrate at $0.26 per cup. Required a. Complete the spreadsheet template to calculate price and usage variances. Spreadsheet Tips 2. The cells that label the variances as F or U (favorable (F) or unfavorable (U)) are based on a function called IF. The IF function is needed because the variance can be either favorable or unfavorable. The formula must determine whether actual expenditures exceed budgeted expenditures to determine whether the variance is unfavorable or favorable. As an example, the formula in cell D22 is =IF(B21>E21,"U","F"). The formula evaluates the expression B21>E21.…
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