he following data is give for the Walker Company: Budgeted production 1,000 units Actual production 980 units Materials: Standard price per lb $2.00 Standard pounds per completed unit 12 Actual pounds purchased and used in production 11,800 Actual price paid for materials $23,000 Labor: Standard hourly labor rate $14 per pound Standard hours allowed per completed unit 4.5 Actual labor hours worked 4,560 Actual total labor costs $62,928 Overhead: Actual and budgeted fixed overhead $27,000 Standard variable overhead rate $3.50 per standard labor hour Actual variable overhead costs $15,500 Overhead is applied on the standard labor hours. 1. The direct labor rate variance is: 912 unfavorable 912 favorable 2,100 unfavorable 2,100 favorable 2. The direct labor time variance is: 912 favorable 912 unfavorable 2,100 unfavorable 2,100 favorable
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
The following data is give for the Walker Company:
Budgeted production 1,000 units
Actual production 980 units
Materials:
Standard price per lb $2.00
Standard pounds per completed unit 12
Actual pounds purchased and used in production 11,800
Actual price paid for materials $23,000
Labor:
Standard hourly labor rate $14 per pound
Standard hours allowed per completed unit 4.5
Actual labor hours worked 4,560
Actual total labor costs $62,928
Overhead:
Actual and budgeted fixed overhead $27,000
Standard variable overhead rate $3.50 per standard labor hour
Actual variable overhead costs $15,500
Overhead is applied on the standard labor hours.
1. The direct labor rate variance is:
|
912 unfavorable |
||
|
912 favorable |
||
|
2,100 unfavorable |
||
|
2,100 favorable |
2. The direct labor time variance is:
|
912 favorable |
||
|
912 unfavorable |
||
|
2,100 unfavorable |
||
|
2,100 favorable |
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