You are required to calculate:i. The sales price variance. ii. The sales volume profit variance. iii. The sales mix variance profit. iv. The sales quantity profit volume variance. A company produces 3 products with the following budget information available:ABCSalesGHC14GHC15GHC18Standard full costGHC10GHC10GHC13Budget Production10,000 units13,000 units 9,000 unitsThe actual sales price and production were:AВCSales priceGHC14.5GH¢15.15GHC19.00Budget production9,500units13,500units8,500units

Hi student Since there are multiple subparts, we will answer only first three subparts. If you want…

Answered: You are required to calculate: i. The…

You are required to calculate: i. The sales price variance. ii. The sales volume profit variance. iii. The sales mix variance profit.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Production-volume variance formula

A: Variance: It implies to a difference between the actual and standard outcomes. If the actual outcome…

Q: A typical planning decision would be described as: Select one: O A. Monitoring actual sales…

A: Typically planning is Process of making a detailed proposal for doing or achieving something. In…

Q: b) Why are separate price and quantity variances computed?

A: Variances is a word used for finding out the difference between the actual and standard levels set…

Q: volume

A: The material total variance is the sum of material price variance and material quantity variance.…

Q: Explain why a favorable sales-quantity variance occurs.

A: Explain the reason for the occurrence of favorable sales quantity variance:When actual sales exceed…

Q: What is the interpretation of the direct-material price variance and the direct-material purchase…

A: Definition: Variance: Variance refers to the different levels in the actual cost incurred and…

Q: Define return on sales ( or profit margin).

A: Financial ratios represent the accounting ratios computed by the management by using elements of…

Q: Variances are computed by taking the difference between which of the following? Multiple Choice O…

A: Product costs are the costs that are directly related to the production of goods or services. Period…

Q: variances. Sales mix variance…

A: Sales variance mainly comprises of three variances: sales price variance, sales volume variance and…

Q: Explain the term flexible budget variance.

A: Flexible Budget: It is a type of budget that changes based on the volume of business activity.…

Q: Of the following pairs of variances found in a flexible budget report, which pair is most likely to…

A: Variance in simple terms means difference or change. In costing variance refers to the difference…

Q: Which of the following underlying assumptions form(s) the basis for gross profit variance analysis?…

A: Gross profit variance analysis is defined as the one which analyse the profit variance that comprise…

Q: What are the relationships among a selling price variance, a sales mix variance, a sales…

A: Definition: Variance: Variance refers to the different levels in the actual cost incurred and…

Q: please solve for these questions: b-1. What is the labor efficiency variance? b-2. What is the…

A: Variance analysis is a method of measuring the difference between the standard numbers expected by…

Q: How can HEB grocery benchmarks be determined when evaluating variances from standard costs.

A: Variance of the standard cost is the difference between the standard cost and the actual cost.…

Q: Cite a specific example of the application of gross profit variance analysis. How will it help the…

A: Variance analysis for any variable enables the entity to break down the variable and establish…

Q: From the following particulars, calculate the following material variances and give their…

A: Solution:- a)Calculation of Material Cost variance as follows under:- It is difference between the…

Q: Question 4: Define the following:…

A: Variable cost refers to that cost which variate with the variations in the production or sales…

Q: When analyzing an organization's budget using 2-variance analysis, the 2 elements used are volume…

A: The correct answer is: b. price varianceA 2-variance study of an organization's budget includes two…

Q: The amount of the activity variance for revenue What is the spending variance for the cost of…

A: Lets understand the basics.Activity variance for revenue is a variance between the planned revenue…

Q: Parallel Enterprises has collected the following data on one of its products. During the period the…

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: Which of the following equations can be used to compute a materials price variance (where AQ =…

A: Introduction: Materials price variance: Difference between the Standard price and actual price and…

Q: Give an example of a Direct Material Price Variance with figures and calculate the variance

A: Direct Material Price Variance is the difference between actual material cost and standard cost of…

Q: Variance analysis SIS

A: Under variance analysis a standard is set for all costs, revenues etc. and this is compared with the…

Q: Explain the relationship between contango, cost-of-carry, and convenience yield. d. Explain the…

A: A derivative contract is a financial agreement or instrument between two or more parties that…

Q: What are the relations among standard costs, flexible budgets, variance analysis and managment by…

A: Because actual costs cannot be predicted in advance, standard costs are estimations of actual costs…

Q: Gross profit variance analysis can be used to study the effect of:" Changes in cost of goods sold on…

A: Gross profit variance refers to the variance that occurred to the amount of gross profit from the…

Q: Which of the following items would be useful to management in deciding whether to investigate the…

A: Standard costs are the budgeted costs related with the production, manufacturing and selling of…

Q: iv) Labour rate variance v) Labour efficiency variance vi) Overhead variances (both) d.…

A: Budget variance is the difference between the actual and budgeted costs occurred in a manufacturing…

Q: G. H. I. J. Budget Perf

A: The term with definition as,

Q: How can the sales-quantity variance be decomposed further?

A: Sales quantity variance identifies the difference between budgeted contribution margin based on…

Q: The “plus” in cost-plus pricing is often referred to as Markup. Extra profit. Gross profit.…

A: Cost plus pricing means when selling price is fixed as a addition of profit on the cost price. For…

Question

You are required to calculate:
i. The sales price variance.
ii. The sales volume profit variance.
iii. The sales mix variance profit.
iv. The sales quantity profit volume variance.

A company produces 3 products with the following budget information available:
A
B
C
Sales
GHC14
GHC15
GHC18
Standard full cost
GHC10
GHC10
GHC13
Budget Production
10,000 units
13,000 units 9,000 units
The actual sales price and production were:
A
В
C
Sales price
GHC14.5
GH¢15.15
GHC19.00
Budget production
9,500units
13,500units
8,500units

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2

Step 3

Step 4

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

The Flexible-Budget Variance is the sum of a. The static-budget variance and the sales-volume variance b. The sales-volume variance and the efficiency variance c. The price variance and the efficiency variance d. The static-budget variance and the price variance
The following direct materials and direct labor data pertain to the operations of Sandhill Company for the month of August. Costs Actual labor rate Actual materials price Standard labor rate Standard materials price $13 $120 $12.50 $124 Quantities per hour per ton per hour per ton Actual hours incurred and used Actual quantity of materials purchased and used Standard hours used Standard quantity of materials used 4,900 hours 2,000 tons 4,960 hours 1,990 tons
Answer only d, e, and f
Which statement is true? A. Gross profit (GP) variance analysis, is an essential part of financial statements analysis that is used to evaluate the performance of a firm's departments responsible for the firm's line activities (functions). B. Increases and decreases in sales and cost of sales have direct relationship with increases and decreases in GP. C. If there is a negative sales price variance and there is no cost variance, the gross profit variance will be equal to the sales price variance. D. A zero cost variance indicates that there is no difference between the standard cost prices and actual cost prices. E. none of the above
b. Calculate the profit variance c. Calculate the total revenue variance. d) Calculate the revenue volume variance. e) Calculate the revenue price variance. f) Calculate the total cost variance.
4. Compute the Material Price variance 5. Compute the Material Quantity variance 6. Compute the Total Labor variance 7. Compute the Labor Price variance 8. Compute the Labor Quantity variance 9. Compute the Total Manufacturing Overhead variance 10. Which variance(s) would be the responsibility of the Production Manager? 11. Which variance(s) would be the responsibility of the Purchasing Manager? Show all calculations for each item step-by-step
Bulldogs Inc. wants to determine the impact of the change in selling price of its sole product in relation to the analysis of its gross profit. Which of the following must the company determine? a. Sales Volume Variance b. Cost Price Variance c. Volume Variance d. Sales Price Variance
Gross profit volume variance is derived by A. combining sales and cost of sales variances. B. combining sales volume and cost volume variances. C. deducting cost price variance from gross profit variance. D. deducting sales price variance from gross profit variance.
The variance that highlights the difference between actual sales volume and the master budget sales volume is the sales activity variance. O flexible budget variance. O master budget variance. O MOH volume variance.
Which of the following underlying assumptions form(s) the basis for gross profit variance analysis? A. In multi-product organization, the sales mix remains discretionary. B. Sales and costs behave in ainear manner C. All of the choices are assumptions that underlie gross profit variance analysis D. Costs can be categorized as variable