MGMT 503 Study Guide - Final Guide: Operating Margin, Income Statement, Variable Cost
9 Dec 2015
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Xyz company produces a compound by mixing three gallons of ab-5 (costing . 25 per gallon) and four gallons of cr-3 (costing . 50 per gallon). The output is five gallons of the compound. During august, 21,000 gallons of ab-5 costing ,500 were purchased and used; 26,000 gallons of cr-3 costing ,000 were purchased and used. Required: calculate the material price variance, calculate the materials efficiency variance. Acme corp. applies overhead to production using a rate of per machine hour ( variable, fixed). Acme produced 15,000 units and incurred overhead of ,710,000 (of which ,495,000 was variable overhead) while using 43,500 machine hours. The overhead standards assume each product would use three machine hours. The practical capacity of 18,000 units was used as the denominator level of activity. Required: calculate the voh spending variance, calculate the voh efficiency variance, calculate the foh budget variance, calculate the foh volume variance.
