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Extracted text: *00 Exercise 16-46 (Algo) Fixed Cost Variances (LO 16-6) Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The company carries no inventories. The master budget calls for the company to manufacture and sell 104,000 liters at a budgeted price of $105 per liter this year. The standard direct cost sheet for one liter of the preservative follows. Direct materials Direct labor (2 pounds @ $6) (0.5 hours @ $28) $12 14 Variable overhead is applied based on direct labor hours. The variable overhead rate is $40 per direct-labor hour. The fixed overhead rate (at the master budget level of activity) is $12 per unit. All non-manufacturing costs are fixed and are budgeted at $1.4 million for the coming year. At the end of the year, the costs analyst reported that the sales activity variance for the year was $354,000 unfavorable. The following is the actual income statement (in thousands of dollars) for the year. Sales revenue $10,498 Less variable costs Direct materials Direct labor Variable overhead 1,168 1,310 1,930 $ 4,408 Total variable costs Contribution margin Less fixed costs Fixed manufacturing overhead Non-manufacturing costs Total fixed costs 060 9 $ 1,370 1,250 $ 2,620 $ 3,470 Operating profit Required: What are the fixed overhead price and production volume variances for Paynesville? (Enter your answers in whole dollars. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.) Fixed overhead price variance Fixed overhead production volume variance < prev="" 4="" of="" 7="" next=""> +66 F4 FS F7 + Q $4 4. %23 7.
Extracted text: Chec Problem 16-72 (Algo) Variance Computations with Missing Data (LO 16-5, 6) The following information is provided to assist you in evaluating the performance of the production operations of Studio Company: Units produced (actual) Master production budget Direct materials Direct labor Overhead Standard costs per unit Direct materials Direct labor Variable overhead Actual costs Direct materials purchased and used Direct labor 57,000 $127,380 108,080 167,910 $1.65 x 2 gallons per unit of output $14 per hour x 0.2 hour per unit $12.50 per direct labor-hour $150,960 (81,600 gallons) 134,231 (9,980 hours) 177,200 (61% is variable) Overhead Variable overhead is applied on the basis of direct labor-hours. Required: Calculate all variable production cost price and efficiency variances and fixed production cost price and production volume variances. (Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.) Efficiency Variance Production Volume Variance Price Variance Direct materials Direct labor F F Variable overhead F F Fixed overhead F