1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Maurinko [17]
3 years ago
12

Genie in a Bottle Company (GBC) manufactures plastic two-liter bottles for the beverage industry. The cost standards per 100 two

-liter bottles are as follows:
Cost Category Standard Cost per 100 Two-Liter Bottles
Direct labor $ 2.00
Direct materials 9.10
Factory overhead 0.55
Total $11.65 B.
At the beginning of July, GBC management planned to produce 400,000 bottles. The actual number of bottles produced for July was 406,000 bottles. The actual costs for July of the current year were as follows:
Cost Category Actual Cost for the Month Ended July 31
Direct labor $ 7,540
Direct materials 35,750
Factory overhead 2,680
Total $45,970
Required:
A. Prepare the July manufacturing standard cost budget (direct labor, direct materials, and factory overhead) for GBC, assuming planned production.
B. Prepare a budget performance report for manufacturing costs, showing the total cost variances for direct materials, direct labor, and factory overhead for July.
C. Interpret the budget performance report.
Business
1 answer:
yan [13]3 years ago
5 0

Answer:

See below.

Explanation:

Since the costs are per 100, to calculate total standard we multiply by 400,000/100 = 4000 and actual qty then is 4060.

For A, standard cost budget at standard prices.

Direct Labor            (2*4000)          = $8,000

Direct Material     (9.1*4000)        = $36,400

Factory Overhead  (0.55*4000)    = $2,200

Total                                                        = $46,600

For B, The total cost variances are as follows,

Material cost variance = (Standard Price - Actual Price) * Actual Quantity  

where, Standard price = 9.1 and Actual price = (35750/4060) = $8.81

Variance = (9.1 - 8.81) * 4060  = $1177.4 Favorable

Direct labor cost variance = (Standard rate - Actual Rate) * Actual Quantity

where, Standard rate = 2 and Actual rate = (7540/4060) = $1.86

Variance = (2-1.86) * 4060  = $568.4 Favorable

Factory Overhead variance

= Standard applied - Actual applied  

Variance = (0.55*4060) - 2680     = $447 Unfavorable

Net effect on total cost variances = (1177.4+568.4-447) = $1298.8 Favorable

For c)

The over all cost performance has favored the business as they ere able to lessen costs in direct labor and material department. However, the fixed costs performance has deteriorated and there may be some technical issues that the company can deal with to ensure they perform better on fixed costs. The over all performance is favorable.

You might be interested in
On October 1, 2014, Mann Company places a new asset into service. The cost of the asset is $80,000 with an estimated 5-year life
Lelu [443]

Answer:

The correct answer is A.

Explanation:

Giving the following information:

On October 1, 2014, Mann Company places a new asset into service. The cost of the asset is $80,000 with an estimated 5-year life and $20,000 salvage value at the end of its useful life.

Annual depreciation= (original cost - salvage value)/estimated life (years)

Annual depreciation= 60,000/5=12,000

3 months depreciation= 12,000/12*3= 3,000

3 0
3 years ago
Which of the following will always be a relevant cost? Select one: a. Sunk cost b. Fixed cost c. Variable cost d. Opportunity co
Vsevolod [243]

Answer: Fixed Cost

Explanation: Fixed cost will always be a relevant cost because a business must incur fixed cost during the course of the business.

Fixed cost are cost that are not depended on sales or activity level of the organisation and they are incurred in as much as the business is operational.

Examples of fixed costs are:

Utilities, salaries, rent, depreciation etc.

Fixed costs has a high influence on the profit/ loss of any organisation.

3 0
3 years ago
In the RST partnership, Ron's capital is $80,000, Stella's is $75,000, and Tiffany's is $50,000. They share income in a 3:2:1 ra
uysha [10]

Answer:

C. Stella, Capital will be debited for $4,000.

Explanation:

As for the provided information, we have,

Out of all the partner's Tiffany is retiring.

Tiffany's capital balance = $50,000

On his retirement he is paid $60,000

Since no goodwill is recorded, the excess amount paid over capital = $60,000 - $50,000 = $10,000, will be debited in remaining partner's ratio.

Ron's share in these $10,000 = $10,000 \times 3/(3+2) = $6,000

Stella's share = $10,000 \times 2/(2+3) = $4,000

Thus, Correct answer is debiting Ron's capital by $6,000 and Stella's capital by $4,000

3 0
3 years ago
​Isabellas, Inc., a local convenience​ store, sells soft drinks. It sells two large drinks for every small drink. A large drink
rjkz [21]

Answer:

Weighted average contribution margin= $1.85

Explanation:

Giving the following information:

It sells two large drinks for every small drink. A large drink sells for $3.00 with a variable cost of $ 0.60. A small drink sells for $ 1.25 with a variable cost of $ 0.50.

To calculate the weighted average contribution margin, we need to use the following formula:

Weighted average contribution margin= (weighted average selling price - weighted average unitary variable cost)

Sales proportion:

Large drink= 0.67

Small drink= 0.33

Weighted average contribution margin= (0.67*3 + 0.33*1.25) - (0.67*0.6 + 0.33*0.5)

Weighted average contribution margin= 2.4225 - 0.567

Weighted average contribution margin= $1.85

4 0
3 years ago
The value of a product minus the costs of raw materials and energy is
nordsb [41]

The gross value is the product minus the costs of raw materials and energy.  Gross value allows a company to see the true value they are gaining after the raw materials and time spent to produce the good are complete. The value is an economic measure that allows a company to see where they stand after the contribution of materials and workers are taken out of the equation.

5 0
3 years ago
Other questions:
  • Ernest is 42 years old and has been out of work for two months. he lost his position as a program manager when his company merge
    14·1 answer
  • Were did west African slave traders get their slaves to sell to Europeans ​
    9·1 answer
  • When Kimberly begins working for Pharmco Industries the company tells her that at a future after so many years of employment wit
    13·1 answer
  • A client has a Cash Account at a broker-dealer and one week ago was sold out of a position for failure to make prompt payment. T
    13·1 answer
  • Maple Leaf, Inc., a television manufacturer, would like to reduce its inventory. To this end, you are asked by the operations ma
    12·1 answer
  • The government uses indexing to revise tax brackets so that workers do not pay higher taxes just because
    8·1 answer
  • the ABC Company has a monthly collected balance of $600,000. Its bank pays an earning credit rate of 0.75%. The Reserve Requirem
    7·1 answer
  • Bulluck Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Direct
    13·1 answer
  • The exchange rate for a stable country
    7·1 answer
  • The u. S. Dollar appreciated relative to other major trading currencies between 2014 and early 2016 primarily because.
    12·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!