18. (15 points) Par Company produces upscale golf bags and has determined the following direct cost...
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18. (15 points) Par Company produces upscale golf bags and has determined the following direct cost categories and budgeted amounts: Budget Cost Budget Inputs Category per unit Direct Materials 3.20 lbs. Direct Labor 4.0 hours Budgeted output 4,500 units per input $7.50 per lb. $15.00 per hr. Actual performance for the company is shown below: Actual output: (in units) 4,000 Direct Materials (DM): DM pounds purchased and used 11,700 Actual price per pound $8.25 Direct Manufacturing Labor (DL): Actual DL price per hour $15.85 Actual DL cost $268,816 a. Calculate the direct materials price, efficiency and flexible budget variances. b. Provide a possible cause or driver for the direct materials price variance. Be specific. C. Calculate the direct labor price, efficiency, and flexible budget variances. 18. (15 points) Par Company produces upscale golf bags and has determined the following direct cost categories and budgeted amounts: Budget Cost Budget Inputs Category per unit Direct Materials 3.20 lbs. Direct Labor 4.0 hours Budgeted output 4,500 units per input $7.50 per lb. $15.00 per hr. Actual performance for the company is shown below: Actual output: (in units) 4,000 Direct Materials (DM): DM pounds purchased and used 11,700 Actual price per pound $8.25 Direct Manufacturing Labor (DL): Actual DL price per hour $15.85 Actual DL cost $268,816 a. Calculate the direct materials price, efficiency and flexible budget variances. b. Provide a possible cause or driver for the direct materials price variance. Be specific. C. Calculate the direct labor price, efficiency, and flexible budget variances.
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