Question 1

Natural Furniture Ltd.makes wooden furniture.One of their products is a wooden desk.The exterior is made of walnut, a high quality wood, but the interior drawers are made of pine, a less expensive wood.The budgeted direct material quantities and prices for one desk are:
  During the month of September 440 desks were produced.The actual material volume and costs were:
  Required:
Calculate the direct materials mix and yield variances for the walnut.

Accepted Answer

The answer of Natural Furniture Ltd.makes wooden furniture.One of their...

Question 2

Answer the following question(s)using the information below.Eco Furniture Ltd.makes wooden furniture.One of their products is a wooden desk.The exterior is made of walnut, a high quality wood, but the interior drawers are made of pine, a less expensive wood.The budgeted direct materials quantities and prices for one desk are:
  During the month of November 600 desks were produced.The actual material volume and costs were:
 
-What is the direct materials mix variance for walnut?

Accepted Answer

The answer of Answer the following question(s)using the information below.Eco...

Question 3

Jam Life Inc.manufactures jam products.It makes a mixed fruit and berry jam by blending strawberries, peaches, and apricots.Budgeted costs to produce 100,000 kilograms of jam in September were:
  Actual costs to produce 100,000 kilograms of jam in September were:
  Required:
1.Calculate the total direct materials rate and efficiency variances.2.Calculate the total direct materials mix and yield variances.3.Jam Life's largest competitor sells a 500 gram jar of mixed fruit and berry jam for $4.50 .If Jam Life's management wants to meet this price and cover monthly fixed costs of $180,000 then what will be the company's margin of safety? (Assume that Jam Life will continue to use the budgeted mix of ingredients.)

Accepted Answer

The answer of Jam Life Inc.manufactures jam products.It makes a...

Question 4

Answer the following question(s)using the information below.Eco Furniture Ltd.makes wooden furniture.One of their products is a wooden desk.The exterior is made of walnut, a high quality wood, but the interior drawers are made of pine, a less expensive wood.The budgeted direct materials quantities and prices for one desk are:
  During the month of November 600 desks were produced.The actual material volume and costs were:
 
-What is the direct materials yield variance for pine?

Accepted Answer

The answer of Answer the following question(s)using the information below.Eco...

Question 5

Answer the following question(s)using the information below.Eco Furniture Ltd.makes wooden furniture.One of their products is a wooden desk.The exterior is made of walnut, a high quality wood, but the interior drawers are made of pine, a less expensive wood.The budgeted direct materials quantities and prices for one desk are:
  During the month of November 600 desks were produced.The actual material volume and costs were:
 
-What is the direct materials mix variance for pine?

Accepted Answer

Direct materials mix variance for pine = (Actual quantity of pine used - Budgeted quantity of pine used) x Budgeted price of walnut
= (4,800 - 5,400) x $1.25
= $7,125 U (unfavorable)

The best choice(s) cannot be determined with the given information.

Question 6

The textbook discusses five levels of variances: Level 0, Level 1, Level 2, Level 3, and Level 4.Briefly explain the meaning of each of those levels and provide an example of a variance at each of those levels.

Accepted Answer

The answer of The textbook discusses five levels of variances:...

Question 7

Answer the following question(s)using the information below.Eco Furniture Ltd.makes wooden furniture.One of their products is a wooden desk.The exterior is made of walnut, a high quality wood, but the interior drawers are made of pine, a less expensive wood.The budgeted direct materials quantities and prices for one desk are:
  During the month of November 600 desks were produced.The actual material volume and costs were:
 
-What is the direct materials yield variance for walnut?

Accepted Answer

The answer of Answer the following question(s)using the information below.Eco...

Question 8

Answer the following question(s)using the information below.Eco Furniture Ltd.makes wooden furniture.One of their products is a wooden desk.The exterior is made of walnut, a high quality wood, but the interior drawers are made of pine, a less expensive wood.The budgeted direct materials quantities and prices for one desk are:
  During the month of November 600 desks were produced.The actual material volume and costs were:
 
-What is the direct materials efficiency variance for walnut?

Accepted Answer

The answer of Answer the following question(s)using the information below.Eco...

Question 9

Answer the following question(s)using the information below.Eco Furniture Ltd.makes wooden furniture.One of their products is a wooden desk.The exterior is made of walnut, a high quality wood, but the interior drawers are made of pine, a less expensive wood.The budgeted direct materials quantities and prices for one desk are:
  During the month of November 600 desks were produced.The actual material volume and costs were:
 
-What is the direct materials efficiency variance for pine?

Accepted Answer

To calculate the direct materials efficiency variance for pine, we need to compare the actual amount of pine used with the standard amount of pine that should have been used for the production of 600 desks.

Actual amount of pine used = 6,200 board feet 
Standard amount of pine that should have been used = 600 desks × 2 drawers/desk × 2 board feet/drawer = 2,400 board feet

Therefore, the direct materials efficiency variance for pine is: 
Standard quantity (SQ) – Actual quantity (AQ) × Standard price (SP) = (2,400 – 6,200) × $1.25 = $8,550 U

So the answer is A, $8,550 U.

Question 10

Jam Life Inc.manufactures jam products.It makes a mixed fruit and berry jam by blending strawberries, peaches, and apricots.Budgeted costs to produce 100,000 kilograms of jam in September were:
  Actual costs to produce 100,000 kilograms of jam in September were:
 
-What is the direct material yield variance for Strawberry Jam? (3 marks)

Accepted Answer

The answer of Jam Life Inc.manufactures jam products.It makes a...

Quiz 7: Flexible Budgets, Variances, and Management Control: I

The textbook discusses five levels of variances: Level 0, Level 1, Level 2, Level 3, and Level 4.Briefly explain the meaning of each of those levels and provide an example of a variance at each of those levels.