Comprehensive problem 5

Comprehensive Problem 5 Genuine Spice Inc. began operations on January 1, 2016. The company produces eight-ounce botes of land and body lotion called Bernal Bely. The lionis sold wholesale in 12 bottle cases for $100 per case. There is a selling commission of $20 case. The January direct materials, direct labor, and factory overhead cents are as follows DIRECT MATERIALS De Materials Cape Case Creambase DIRECTLABOR Late Rome Department Bavier Direct Later Castre 5220 FACTORY OVERHEAD Cost Beste folos 4300 Part A--Break Even Analysis The management of Genuine Spice Inc washes to determine the number of ces required to break even per month The icon, which is part of factory read, ha med Chapter 22 Performance Evaluation Using Variances from Standard Coss 1071 cost. The following information was gathered from the first six months of operation garding this cost 660 March April 720 60 Instructions 1. Determine the fixed and variable portion of the unity cost wing the high-low method 2. Determine the contribution margin per Determine the fixed costs per month, including the utility fixed cost from part () 4. Determine the break even number of cases per month Part 8-August Budgets During July of the current year, the management Genuine Spice Inc asked the controller to prepare August manufacturing and income statement budgets. Demand was expected to be so calles at $100 per case for Auge. Inventory planning Information is provided Estimated the goods Inventory August 1, 2016 10 51200 7.000 Estimated material inventory August 2016 250 There was neighle work in process imemy assumed for either the beginning or end of the mother was sed. In addition, there was no change in the cost per unitetimes per wing data from January Instructions S Prepare the producent 6 Prepare the past direct material purchases budget 7. Prepare the direct the bound the hours required for produce Prepare the day whead 9. Prepare the Austrated income tamen, induting selling expenses Part-August Variance Analysis During her of the current year, the controller was asked to perform variance analys for August The January ating data provided the standard prices which was 30 means the planned at the beginning of the month Actual data for 1072 Chapter 22 Performance Evaluation Using Varances from Standard Cons Actual Direct Material Actual Direct Materiale Price per Unit Quantity per Case Crean bare 50016 pero $0.12 per 50:42 per bottle 125 bottles Actual Direct Labor Time Care Alves The prices of the materials were different than mandard die toestations in market prices. The standard quantity of mailed percase was an ideal standard. The Min in recher grade labores during them, thus causing the actual laborale to caceed standard. The Falling Department used awer grade liber classification during the month, thus causing the actual laborate to be low standard Instructions 10. Determine interpret the direct materials price and quantity variances for the thee 11. Descrmine and interpret the direct laborate and time variances for the we departments, Roundhours to the nearest hour 12. Determine and in the factory had controllable variance 13. Determine and interpret the factory overhead volume variance 14. Why are the standard direct labor and direct materials costs in the calculations for parts (10) and (11) based on the actual 1.00-cise peaduction volume rather than the planned 1.250 cases of production used in the budget for parts (6and 1 Mising time 12.55U Comprehensive Problem 5 Genuine Spice Inc. began operations on January 1, 2016. The company produces eight-ounce botes of land and body lotion called Bernal Bely. The lionis sold wholesale in 12 bottle cases for $100 per case. There is a selling commission of $20 case. The January direct materials, direct labor, and factory overhead cents are as follows DIRECT MATERIALS De Materials Cape Case Creambase DIRECTLABOR Late Rome Department Bavier Direct Later Castre 5220 FACTORY OVERHEAD Cost Beste folos 4300 Part A--Break Even Analysis The management of Genuine Spice Inc washes to determine the number of ces required to break even per month The icon, which is part of factory read, ha med Chapter 22 Performance Evaluation Using Variances from Standard Coss 1071 cost. The following information was gathered from the first six months of operation garding this cost 660 March April 720 60 Instructions 1. Determine the fixed and variable portion of the unity cost wing the high-low method 2. Determine the contribution margin per Determine the fixed costs per month, including the utility fixed cost from part () 4. Determine the break even number of cases per month Part 8-August Budgets During July of the current year, the management Genuine Spice Inc asked the controller to prepare August manufacturing and income statement budgets. Demand was expected to be so calles at $100 per case for Auge. Inventory planning Information is provided Estimated the goods Inventory August 1, 2016 10 51200 7.000 Estimated material inventory August 2016 250 There was neighle work in process imemy assumed for either the beginning or end of the mother was sed. In addition, there was no change in the cost per unitetimes per wing data from January Instructions S Prepare the producent 6 Prepare the past direct material purchases budget 7. Prepare the direct the bound the hours required for produce Prepare the day whead 9. Prepare the Austrated income tamen, induting selling expenses Part-August Variance Analysis During her of the current year, the controller was asked to perform variance analys for August The January ating data provided the standard prices which was 30 means the planned at the beginning of the month Actual data for 1072 Chapter 22 Performance Evaluation Using Varances from Standard Cons Actual Direct Material Actual Direct Materiale Price per Unit Quantity per Case Crean bare 50016 pero $0.12 per 50:42 per bottle 125 bottles Actual Direct Labor Time Care Alves The prices of the materials were different than mandard die toestations in market prices. The standard quantity of mailed percase was an ideal standard. The Min in recher grade labores during them, thus causing the actual laborale to caceed standard. The Falling Department used awer grade liber classification during the month, thus causing the actual laborate to be low standard Instructions 10. Determine interpret the direct materials price and quantity variances for the thee 11. Descrmine and interpret the direct laborate and time variances for the we departments, Roundhours to the nearest hour 12. Determine and in the factory had controllable variance 13. Determine and interpret the factory overhead volume variance 14. Why are the standard direct labor and direct materials costs in the calculations for parts (10) and (11) based on the actual 1.00-cise peaduction volume rather than the planned 1.250 cases of production used in the budget for parts (6and 1 Mising time 12.55U