Gabbe Industries is a division of a major corporation. Last year the division had total sales of $31,098,000, net operating inco
me of $4,509,210, and average operating assets of $8,760,000. The company's minimum required rate of return is 20%. Required: a. What is the division's margin
1 answer:
You might be interested in
Answer:
price variance $(22,800.00) UNFAVORABLE
Explanation:
std cost $6.00
actual cost $9.00
quantity 7,600
difference $(3.00)
price variance $(22,800.00)
We calculate the actual cost by dividing total cost by the lbs purchased:
68,400/7,600 = 9
Because the diference is negative, the variance is unfavorable.
Each pound cost more than it was planned.