Benson Publications established the following standard price and costs for a hardcover picture book that the company produces. Standard price and variable costs Sales price$36.30 Materials cost 8.80 Labor cost 4.10 Overhead cost 6.10 Selling, general, and administrative costs 6.80 Planned fixed costs Manufacturing overhead$132,000 Selling, general, and administrative 45,000 Assume that Benson actually produced and sold 32,000 books. The actual sales price and costs incurred follow: Actual price and variable costs Sales price$35.30 Materials cost 9.00 Labor cost 4.00 Overhead cost 6.15 Selling, general, and administrative costs 6.60 Actual fixed costs Manufacturing overhead$117,000 Selling, general, and administrative 51,000 Requireda. & b. Determine the flexible budget variances and also Indicate whether each variance is favorable (F) or unfavorable (U). (Select "None" if there is no effect (i.e., zero variance).) Sales revenueVariable manufacturing costsMaterialsLaborOverheadVariable selling, general, and administrative costsContribution marginFixed costsManufacturing overheadSelling, general, and administrative costsNet incomeFlexible BudgetVariances

Flexible Budget : It is the type of budgets that can be adjusted according to its units produced and…

Answered: son Publications established the…

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter2: Basic Managerial Accounting Concepts

Section: Chapter Questions

Problem 2MCQ: Product (or manufacturing) costs consist of a. direct materials, direct labor, and selling costs. b....

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Benson Publications established the following standard price and costs for a hardcover picture book that the company produces.


Standard price and variable costs
Sales price	$	36.30
Materials cost		8.80
Labor cost		4.10
Overhead cost		6.10
Selling, general, and administrative costs		6.80
Planned fixed costs
Manufacturing overhead	$	132,000
Selling, general, and administrative		45,000

Assume that Benson actually produced and sold 32,000 books. The actual sales price and costs incurred follow:


Actual price and variable costs
Sales price	$	35.30
Materials cost		9.00
Labor cost		4.00
Overhead cost		6.15
Selling, general, and administrative costs		6.60
Actual fixed costs
Manufacturing overhead	$	117,000
Selling, general, and administrative		51,000

Required

a. & b. Determine the flexible budget variances and also Indicate whether each variance is favorable (F) or unfavorable (U). (Select "None" if there is no effect (i.e., zero variance).)

Sales revenue
Variable manufacturing costs
Materials
Labor
Overhead
Variable selling, general, and administrative costs
Contribution margin
Fixed costs
Manufacturing overhead
Selling, general, and administrative costs
Net income
Flexible Budget
Variances

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