Answer:
Explanation:
1. Raw materials cost to be included in the planning budget for March = 28,000 x $ 36 = $ 1,008,000
2. Raw materials cost to be included in the flexible budget for March = 33,000 x $ 36 = $ 1,188,000
3. Materials price variance for March = ( Standard price per unit - Actual price per unit ) x Actual quantity purchased = $ ( 9.00 - 7.20) x 165,000 pounds = $ 297,000 F
4. Materials quantity variance for March = ( standard quantity allowed for actual output - actual quantity used ) x standard price per unit = ( 132,000 - 165,000) x $ 9 = $ 297,000 U
5. Materials price variance = $ ( 9 - 7.20) x 173,000 = $ 311,400 F
6. Materials quantity variance = ( 132,000 - 165,000) x $ 9 = $ 297,000 U
7. Direct labor cost included in the planning budget for March = 28,000 x $ 36 = $ 1,008,000
8. Direct labor cost included in the flexible budget for March = 33,000 x $ 36 = $ 1,188,000
9. Labor rate variance for March = ( standard labor hour rate - actual labor hour rate ) x actual hours used = $ ( 12.00 - 13.00 ) x 58,000 = $ 58,000 U
10. Labor efficiency variance for March = ( standard hours allowed for actual output - actual hours used ) x standard labor hour rate = ( 3 x 33,000 - 58,000) x $ 12 = $ 492,000 F
11. Labor spending variance for March = $ 492,000 F + $ 58,000 U = $ 434,000 F
12. Variable manufacturing overhead cost to be included in the planning budget for March = 28,000 x $ 24 = $ 672,000
13. Variable manufacturing overhead included in the flexible budget for March = 33,000 x $ 24 = $ 792,000
14. Variable overhead rate variance for March = $ ( 8 - 12.57) x 58,000 = $ 265,060 U
15. Variable overhead efficiency variance for March = ( 3 x 33,000 - 58,000) x $ 8 = $ 328,000
