Rolando E. Caser Jr.

Strategic Business Analysis

BSA-3A TTh 3:00PM-4:30PM

a AQ x AP (51,000 x 14.10) 719,100

AQ x SP (51,000 x 14) 714,000
Materials price variance (U) 5,100 U

Proof:
Actual price 14.10
Standard price 14
Unfavorable difference in price 0.10
Multiplied by actual quantity 51,000
Materials price variance (U) 5,100 U

b AQ x SP (37,000 x 14) 518,000

SQ x SP (9,500 x 4 x 14) 532,000
Materials quantity variance (F) (14,000) F

Proof:
Actual quantity 37,000
Standard quantity (9,500 x 4) 38,000
Favorable difference in quantity (1,000)
Multiplied by standard price 14
Materials quantity variance (F) (14,000) F

c AQ x AP (71,000 x 10.20) 724,200

AQ x SP (71,000 x 10) 710,000
Labor rate variance (U) 14,200 U

Proof:
Actual rate (724,200/71,000) 10.20
Standard rate 10
Unfavorable difference in rate 0.20
Multiplied by actual efficiency 71,000
Labor rate variance (U) 14,200 U

d AQ x SP (71,000 x 10) 710,000

SQ x SP (9,500 x 8 x 10) 760,000
Labor efficiency variance (F) (50,000) F

Proof:
Actual efficiency 71,000
Standard efficiency (9,500 x 8) 76,000
Favorable difference in efficiency (5,000)
Multiplied by standard rate 10
Labor efficiency variance (F) (50,000) F
e AQ x AP 557,350
AQ x SP (71,000 x 8) 568,000
Variable overhead spending variance (F) (10,650) F

Proof:
Actual rate (557,350/71,000) 7.85
Standard rate 8
Favorable difference in rate (0.15)
Multiplied by actual effciency 71,000
Variable overhead spending variance (F) (10,650) F

f AQ x SP (71,000 x 8) 568,000
SQ x SP (9,500 x 8 x 8) 608,000
Variable overhead efficiency variance (F) (40,000) F

Proof:
Actual efficiency 71,000
Standard efficiency (9,500 x 8) 76,000
Favorable difference in efficiency (5,000)
Multiplied by standard rate 8
Variable overhead efficiency variance (F) (40,000) F

g Actual fixed overhead 920,000

Standard fixed overhead 960,000
Fixed overhead spending variance (F) (40,000) F

h Standard fixed overhead 960,000

Applied fixed overhead (9,500 x 8 x 12) 912,000
Fixed overhead volume variance (U) 48,000 U

i Actual variable overhead 557,350

Actual fixed overhead 920,000
Total actual overhead 1,477,350

Applied variable overhead 608,000

Applied fixed overhead 912,000
Total applied overhead 1,520,000

Total actual overhead 1,477,350

Total applied overhead 1,520,000
Total overhead variance (F) (42,650) F
Two-way variance analysis

Total standard overhead 1,568,000

Total applied overhead 1,520,000
Volume variance (U) 48,000 U

Total actual overhead 1,477,350

Total standard overhead 1,568,000
Budget variance (F) (90,650) F

Volume variance (U) 48,000

Budget variance (F) (90,650)
Total overhead variance (F) (42,650) F

Three-way variance analysis

Total actual overhead 1,477,350

Budget allowed on actual hours ((71,000 x 8) + 960,000) 1,528,000
Budget variance (F) (50,650) F

Budget allowed on actual hours 1,528,000

Budget allowed on standard hours ((9,500 x 8 x 8) + 960,000) 1,568,000
Efficiency variance (F) (40,000) F

Budget allowed on standard hours 1,568,000

Total applied overhead 1,520,000
Volume variance (U) 48,000 U

Budget variance (F) (50,650)

Efficiency variance (F) (40,000)
Volume variance (U) 48,000
Total overhead variance (F) (42,650) F

Four-way variance analysis

Actual variable overhead 557,350

Standard variable overhead 568,000
Variable overhead budget variance (F) (10,650) F

Actual fixed overhead 920,000

Standard fixed overhead 960,000
Fixed overhead spending variance (F) (40,000) F
Variable overhead budget variance (F) (10,650)
Fixed overhead spending variance (F) (40,000)
Efficiency variance (F) (40,000)
Volume variance (U) 48,000
Total overhead variance (F) (42,650) F