Use the information below to complete the variance analysis calculations for Sar

Question

Use the information below to complete the variance analysis calculations for Sarah's Soaps.

SARAH'S SOAPS VARIANCE ANALYSIS Budget Actual Fav(Unfav Market Size(12 Packs) 50,000 Sarah's Soaps 12 Packs Share % 60,000 11,000 18.3% 10,000 1,000 1.7% 10,000 2.00% Revenue Material Direct Labor Variable Mfg OH Contribution Margin 49,000 Manufacturing Marketing/Advertisin 8,000 100,000 20,000 16,000 15,000 104,500 21,780 18,150 13,860 50,710 11,000 10,000 4,500 (1,780) (2,150) 1,140 1,710 (1,000) (2,000) 10,000 Engineering Administration Profit 10,000 10,000 11,000 8,000 10,500 11,210 2,000 (500) 210 Revenue/Unit Total Cost/Unit (0.50) (0.21) 10.00 9.50 5.10 4.89 Mat'l pounds/dozen Matl- $/pound Total Mat'l Cost 4 4.4 0.45 21,780 (0.40) 0.05 (1,780) 0.50 20,000 DL Hrs/Unit DL S/Hour Total DL Cost 0.2 8.00 16,000 0.22 7.50 18,150 (0.02) 0.50 (2,150) Var. OH machine hrs/unit Var. OH S/machine 3.00 hr Total Variable OH 0.5 0.45 0.05 2.80 0.20 15,000 13,860 1,140

Explanation / Answer

A B C Workings Mat'l Usage Variance Actual Units Variance Pounds/Units Budget $/Unit FAV(UNFAV) 11000 -0.40 $                                 0.50 $   (2,200.00) AxBxC Mat'l Cost Variance Actual Units Act Pounds/Units Variance $/Pound 11000 4.40 $                                 0.05 $      2,420.00 AxBxC Labour Efficiency Variance Actual Units Variance Hours/Units Budget $/Hour 11000 -0.02 $                                 8.00 $   (1,760.00) AxBxC Labour Cost Variance Actual Units Act Hours/Units Variance $/Hour 11000 0.22 $                                 0.50 $      1,210.00 AxBxC Variable OH Usage Variance Actual Units Variance Mach Hrs/Units Budget $/Mach hr 11000 0.05 $                                 3.00 $      1,650.00 AxBxC Variable OH Cost Variance Actual Units Act Mach hrs.Units Variance $/Match hr 11000 0.45 $                                 0.20 $         990.00 AxBxC Fixed Mfg. OH Budgeted Fixed OH Actual Fixed OH $                            10,000.00 $                      11,000.00 $   (1,000.00) B-C TOTAL MANUFACTURING VARIANCE $      1,310.00 Budgeted Actual Engineering Variance $                            10,000.00 $                         8,000.00 $      2,000.00 B-C Admin Variance $                            10,000.00 $                      10,500.00 $       (500.00) B-C Total Sales and Marketing Variance $   (2,600.00) Total Manufacturing Variance $      1,310.00 Engineering Variance $      2,000.00 Admin Variance $       (500.00) Total Variance (match with profit variance) $         210.00

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