7-36 Comprehensive variance analysis review. Andrew Scheid Ltd manufactures kitchen cabinets. The company’s budget for fixed costs per month is $7,500 and budgeted variable costs per cabinet are: The company had budgeted to make and sell 1,000 cabinets per month at a selling price of $150 each. However, in June, the actual figures were as follows: The company had budgeted to make and sell 1,000 cabinets per month at a selling price of $150 each. However, in June, the actual figures were as follows: Calculate the following: Calculate the following: 1. Static-budget and actual operating income 2. Static-budget variance for operating income 3. Flexible-budget operating income 4. Flexible-budget variance for operating income 5. Sales-volume variance for operating income 6. Price and efficiency variances for direct manufacturing labor 7. Flexible-budget variance for direct manufacturing labor

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Question 1 & Question 2. :Static-budget and actual operating income and and Static-budget variance for operating income

Static-budget and actual operating income and Variance
Static-budgetActual-JuneVariance
1400 UnitsActual-static
ASales(1,000 Cabinets x$150)$150,000$212,800$62,800Favorable
Direct material (1,000 Cabinetsx$67.50)$67,500$121,000$53,500Unfavorable
Direct labour (1,000 Cabinetsx $30)$30,000$34,000$4,000Unfavorable
Other variable cost (1,000 Cabinetsx $15)$15,000$15,000
Fixed cost$7,500$6,000-$1,500Favorable
BTotal Cost$120,000$176,000$56,000Unfavorable
C=A-BOperating income$30,000$36,800$6,800Favorable

Question 3 , Question 4 & Question 5 Flexible-budget operating income Flexible-budget variance for operating income Sales-volume variance for operating income

Static-budget and actual operating income and Varianle
Flexible-budgetActual-JuneVariance
1400 UnitsActual-Flexible
ASales(1,400 Cabinets x$150)$210,000$212,800$2,800Favorable
Direct material (1,400 Cabinetsx$67.50)$94,500$121,000$26,500Unfavorable
Direct labour (1,400 Cabinetsx $30)$42,000$34,000-$8,000Favorable
Other variable cost (1,400 Cabinetsx $15)$21,000$15,000-$6,000Favorable
Fixed cost$7,500$6,000-$1,500Favorable
BTotal Cost$165,000$176,000$11,000Unfavorable
C=A-BOperating income$45,000$36,800-$8,200Unfavorable

Sales Volume variance: