I Love My Chocolate Company makes dark chocolate and light chocolate. Both products require cocoa and sugar. The following planning information has been made available:
Standard Amount per Case
Dark Chocolate Light Chocolate Standard Price per Pound
Cocoa 12 lbs. 8 lbs. $7.25
Sugar 10 lbs. 14 lbs. 1.40
Standard labor time 0.50 hr. 0.60 hr.
Dark Chocolate Light Chocolate
Planned production 4,700 cases 11,000 cases
Standard labor rate $15.50 per hr. $15.50 per hr.
I Love My Chocolate Company does not expect there to be any beginning or ending inventories of cocoa or sugar. At the end of the budget year, I Love My Chocolate Company had the following actual results:
Dark Chocolate Light Chocolate
Actual production (cases) 5,000 10,000
Actual Price per Pound Actual Pounds Purchased and Used
Cocoa $7.33 140,300
Sugar 1.35 188,000
Actual Labor Rate Actual Labor Hours Used
Dark chocolate $15.25 per hr. 2,360 Light chocolate 15.80 per hour. 6,120
Required:
1. Prepare the following variance analyses for both chocolates and the total, based on the actual results and production levels at the end of the budget year: Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.
O Direct materials price variance, direct materials quantity variance, and total variance.
O Direct labor rate variance, direct labor time variance, and total variance.
a) Direct materials price variance $
Direct materials quantity variance $
Total direct materials cost variance $
b) Direct labor rate variance $
Direct labor time variance $
Total direct labor cost variance $