Modern Tiles Ltd. manufactures ceramic tiles. For January 2017,it budgeted to purchase and use 10,000 pounds of

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Modern Tiles Ltd. manufactures ceramic tiles. For January 2017,it budgeted to purchase and use 10,000 pounds of clay at \($0.70\) a pound. Actual purchases and usage for January 2017 were 11,000 pounds at \($0.65\) a pound. Modern Tiles Ltd. budgeted for 40,000 ceramic tiles.
Actual output was 43,000 ceramic tiles.
1. Compute the flexible-budget variance.
2. Compute the price and efficiency variances.
3. Comment on the results for requirements 1 and 2 and provide a possible explanation for the
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Horngrens Cost Accounting A Managerial Emphasis

ISBN: 9781292211541

16th Global Edition

Authors: Srikant Datar, Madhav Rajan

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