Question: Aunt Molly s Old Fashioned Cookies bakes cookies for a chain

Aunt Molly’s Old Fashioned Cookies bakes cookies for a chain of retail stores. The company’s best-selling cookie is Chocolate Nut Supreme, which is marketed as a gourmet cookie and regularly sells for $9.60 per kilogram. The standard input cost per kilogram of Chocolate Nut Supreme, based on Aunt Molly’s normal monthly production of 400,000 kilograms, is calculated as follows:
Aunt Molly’s management accountant, Karen Blair, prepares monthly budget reports based on these standard costs. Presented here is April’s report, which compares budgeted and actual performance.
1. Compute the following variances:
a. Selling-price variance.
b. Material-price variance.
c. Material-efficiency variance.
d. Labour-price variance.
e. Labour-efficiency variance.
2. What explanations might exist for the variances in requirement 1?

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