Stuart Publications established the following standard price and costs for a har
ID: 2401956 • Letter: S
Question
Stuart Publications established the following standard price and costs for a hardcover picture book that the company produces.Standard price and variable costs
Sales price $ 36.10 Materials cost 8.10 Labor cost 4.00 Overhead cost 5.60 Selling, general, and administrative costs 7.00 Planned fixed costs
Manufacturing overhead $ 133,000 Selling, general, and administrative 53,000
Assume that Stuart actually produced and sold 22,000 books. The actual sales price and costs incurred follow:
Actual price and variable costs
Sales price $ 35.10 Materials cost 8.30 Labor cost 3.90 Overhead cost 5.65 Selling, general, and administrative costs 6.80 Actual fixed costs
Manufacturing overhead $ 118,000 Selling, general, and administrative 59,000
Required
a. & b. Determine the flexible budget variances and also indicate the effect of each variance by selecting favorable (F) or unfavorable (U). (Select "None" if there is no effect (i.e., zero variance).)
Required a. & b. Determine the flexible budget variances and also indicate the effect of each variance by selecting favorable (F) or unfavorable (U). (Select "None" if there is no effect (i.e., zero variance).) Can you help me please? Can you also explain how you got the answer? Manufacturing overhead Selling, general, and administrative $118,e0e 59,060 Required a, & b. Determine the flexible budget variances and also indicate the effe (U) (Select "None" if there is no effect (i.e., zero variance).) Flexible Budg Variances Sales revenue $ 22,000 Variable manufacturing costs Materials Labor Overhead Selling, general,and administrative costs 4,400 2,200 1,100 ? 4.400 Contribution margin Fixed costs Manufacturing overhead Selling, general, and administrative costs 15,000 6,000 Net income K Prev3 of 4 rch
Explanation / Answer
A & B) flexible budget and variances : Actual Results Flexible Budget Variances F/U/N Books 22000 22000 0 Sales revenue 772200 794200 22000 F Variable manuf costs: Materials 182600 178200 4400 U Labor 85800 88000 2200 F overhead 124300 123200 1100 U selling and Admin costs 149600 154000 4400 F Total Variable cost 542300 543400 1100 F Contribution margin 229900 250800 20900 U Fixed costs Manufacturing overhead 118000 133000 15000 F selling and Admin costs 59000 53000 6000 U Total Fixed costs 177000 186000 9000 F Net Income 52900 64800 11900 U