# Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The company carries...

###### Question:

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 110,000 liters at a budgeted price of $150 per liter this year. The standard direct cost sheet for one liter of the preservative follows.  Direct materials (2 pounds @$9) $18 Direct labor (0.5 hours @$34) 17

Variable overhead is applied based on direct labor hours. The variable overhead rate is $70 per direct-labor hour. The fixed overhead rate (at the master budget level of activity) is$35 per unit. All non-manufacturing costs are fixed and are budgeted at $1.7 million for the coming year. At the end of the year, the costs analyst reported that the sales activity variance for the year was$480,000 unfavorable.

The following is the actual income statement (in thousands of dollars) for the year.

 Sales revenue $15,838 Less variable costs Direct materials 1,738 Direct labor 1,760 Variable overhead 3,480 Total variable costs$ 6,978 Contribution margin $8,860 Less fixed costs Fixed manufacturing overhead 1,100 Non-manufacturing costs 1,280 Total fixed costs$ 2,380 Operating profit $6,480 During the year, the company purchased 186,000 pounds of material and employed 45,400 hours of direct labor. Required: a. Compute the direct material price and efficiency variances. b. Compute the direct labor price and efficiency variances. c. Compute the variable overhead price and efficiency variances. (For all requirements, 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.) rev: 11_20_2019_QC_CS-191240 ## Answers #### Similar Solved Questions 1 answer ##### How do you solve x+ \frac { 3} { 4} = 5\frac { 4} { 5}? How do you solve x+ \frac { 3} { 4} = 5\frac { 4} { 5}?... 1 answer ##### Give me the reason about the correct choice. 2. A ball rolling down a hill is... give me the reason about the correct choice. 2. A ball rolling down a hill is an example of the conversion of: Kinetic energy to gravitational potential energy b) Chemical potential energy to gravitational potential energy c) Chemical potential energy to thermal energy d) Gravitational potential ... 1 answer ##### A s shown in Figure 1, the flow field s of cricket balls in a uniform... A s shown in Figure 1, the flow field s of cricket balls in a uniform flow were visualized by using oil smoke techniques (a) From the flow visualization results shown in Figure 1(a), one can see the flow over the lower surface of cricket ball separates earlier than the flow over upper surface. Pleas... 1 answer ##### Thank you :) Ch 15 Saved 26 Part 2 of 4 Required Information Use the following... thank you :) Ch 15 Saved 26 Part 2 of 4 Required Information Use the following information to answer questions The following information applies to the questions displayed below] 0.25 The following information is available for Lock-Tite Company, which produces special-order security products a... 1 answer ##### No excel. 14. (4 pts) A special power tool for plastic products costs$400, has a...
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