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The AdelbodenAdelboden Chocolate Company uses standard costs and a flexible budget to control its manufacture of fine chocolates. The purchasing agent is responsible for material price variances, and the production manager is responsible for all other variances. Operating data for the past week are summarized as follows:

.

1.

Finished units produced:3,000 boxes of chocolates.

2.

Direct materials: Purchased and used,3,350 pounds of chocolate at 16.8

Swiss francs (CHF) per pound; standard price is CHF17 per pound. Standard allowed per box produced is 11 pound.

3.

Direct labor: Actual costs 5,650 hours at CHF 36.7, or CHF

207,355.

Standard allowed per box produced is

1.75

hours. Standard price per direct-labor hour is CHF

36.

4.

Variable manufacturing overhead: Actual costs, CHF

90,450.

The budget formula is CHF

15

per standard direct-labor hour.

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.

Requirement 1 a & b. Compute the materials purchase-price variance and the materials quantity variance by completing the variance analysis below for direct materials. Be sure to label each variance as favorable or unfavorable. (Enter amounts as positive numbers.)

	A			B			C
							Flexible Budget
	Actual Cost			Flexible Budget			Based on Standard
	Incurred:			Based on Actual			Inputs Allowed for Actual
	Actual Inputs x			Inputs x Standard			Outputs Achieved
	Actual Prices			Prices			x Standard Prices
Direct CHF			CHF			CHF
material		Price variance			Quantity variance
		CHF			CHF
		Flexible budget variance
			CHF

Requirement 1 c & d. Compute the direct labor price variance and the direct-labor quantity variance by completing the variance analysis below for direct-labor. Be sure to label each variance as favorable or unfavorable. (Enter amounts as positive numbers.)

	A			B			C
							Flexible Budget
	Actual Cost			Flexible Budget			Based on Standard
	Incurred:			Based on Actual			Inputs Allowed for Actual
	Actual Inputs x			Inputs x Standard			Outputs Achieved
	Actual Prices			Prices			x Standard Prices
Direct CHF			CHF			CHF
labor		Price variance			Quantity variance
		CHF			CHF
		Flexible budget variance
			CHF

Requirement 1 e & f. Compute the variable manufacturing-overhead spending variance and the variable manufacturing-overhead efficiency variance by completing the variance analysis below for variable manufacturing-overhead. Be sure to label each variance as favorable or unfavorable. (Enter amounts as positive numbers.)

	A			B			C
							Flexible Budget
	Actual Cost			Flexible Budget			Based on Standard
	Incurred:			Based on Actual			Inputs Allowed for Actual
	Actual Inputs x			Inputs x Standard			Outputs Achieved
	Actual Prices			Prices			x Standard Prices
Variable CHF			CHF			CHF
manufacturing		Spending variance			Efficiency variance
overhead		CHF			CHF
		Flexible budget variance
			CHF

Requirement 2a. What is the budget allowance for direct labor?

The budget allowance under standard costing for variable costs always depends on

direct labor cost

direct labor hours

material quantities

output

. Therefore, the direct-labor budget for

3,000

units (boxes) is

CHFnothing.

Requirement 2b. Would it be any different if production were

4,000

boxes?The direct-labor budget for

4,000

units (boxes) would

beCHFnothing.

Choose from any list or enter any number in the input fields and then continue to the next question.

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