The variable overhead rate variance may be caused by variances in the following production inputs except

A.

indirect labor.

B.

direct materials.

C.

indirect materials.

D.

None of the above impacts the variable overhead rate variance.

Confections is known for its rich dark chocolate

fudge truffles.

Cyri

sells its

fudge truffles

to local retailers. A "unit" of

fudge truffles

is a 10-pound batch. The standard quantities of ingredients for a batch include

6

cups of sugar,

23

ounces of chocolate chips,

16

ounces of butter, and

18

ounces of evaporated milk. The standard costs for each of the ingredients are as follows:

$0.20

per cup of sugar,

$0.16

per ounce of chocolate chips,

$0.10

per ounce of butter, and

$0.06

per ounce of evaporated milk. Calculate the standard direct material cost per batch of

fudge truffles.

Calculate the standard direct material (DM) cost per batch of

fudge truffles.

(Enter all dollar amounts to two decimal places.)

	Standard Quantity		Standard Price		Standard Cost
Sugar per cup		x		=
Chocolate chips per ounce		x		=
Butter per ounce		x		=
Evaporated milk per ounce		x		=
Standard DM cost per batch

Cadbury Creme Egg is an egg-shaped chocolate candy that weighs about 35 grams, or a little more than 1.2 ounces.

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Assuming that Cadbury uses standard costing in its manufacturing operations, what variance would have been impacted by the decrease in the cost of the chocolate used in the Cadbury eggs? Would this variance have been favorable or unfavorable? What position or department within Cadbury would have been responsible for that variance?

The

direct materials quantity

direct labor rate

direct labor efficiency

direct materials price

direct materials quantity

fixed overhead budget variance

fixed overhead volume variance

variable manufacturing overhead efficiency

variable manufacturing overhead rate

variance would have been impacted by the decrease in the cost of the chocolate and it would have been a

favorable

favorable

unfavorable

price

rate

efficiency

price

quantity

budget

volume

variance. Normally the

production

human resources

production

purchasing

receiving

supervisor is responsible for this variance, but the facts state that "the company" changed the ingredient. As a result, the person or group responsible for making the change in the ingredient should be responsible.

More info:

It is filled with a white fondant and a smaller amount of yellow fondant, meant to mimic an actual egg. (Fondant is a type of sugar syrup.) In the United States, Cadbury Creme Eggs are marketed and distributed by The Hershey Company. The Creme Eggs are produced by Cadbury Adams in Canada and by Cadbury UK in the United Kingdom. In the UK factory, 1.5 million Creme Eggs are manufactured per day. Creme Eggs are sold every year from New Year's Day until Easter.

Recently, Cadbury changed its formula for the eggs by replacing its Cadbury Dairy Milk chocolate with "standard cocoa mix chocolate". The standard chocolate is a less expensive ingredient than the Cadbury Dairy Milk chocolate. The company assured customers that the taste of the Creme Eggs would not change. Consumers reacted negatively to the recipe change. Sales of Cadbury Creme Eggs fell significantly since the chocolate substitution; this drop has been speculated to have been caused by the change in the recipe.